Chapter 14: Industrialization, 1865-1901 · 2018-08-06 · CHAPTER 14 Industrialization 439 1877...

1882• Standard Oil

forms trust

1876• Korea forced to

trade with Japan

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434

Industrialization1865–1901

1869• Chemist Dmitri Mendeleyev

creates periodic table of elements

Why It MattersThe rise of the United States as an industrial power began after the Civil War. Many factors

promoted industry, including cheap labor, new inventions and technology, and plentiful raw

materials. Railroads rapidly expanded. Government policies encouraged growth, and large

corporations became an important part of the economy. As industry expanded, workers tried to

form unions to fight for better wages and working conditions.

The Impact TodayTrends which began in this era can still be seen today.

• Corporations continue to play an important role.

• Technology continues to change American life.

• Unions remain powerful in many industries.

The American Vision Video The Chapter 14 video, “Building America,” examines industrial expansion in theUnited States in the late 1800s.

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1869• Transcontinental

railroad completed

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1876• Alexander Graham Bell

invents telephone

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1879• Edison

perfects

lightbulb

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1867• British colonies unite to

form Dominion of Canada

1881• Russian czar

Alexander II

assassinated

▼▼

1865 1875 1885

Hayes1877–1881

Arthur1881–1885

Cleveland1885–1889

Garfield1881

Grant1869–1877

A. Johnson1865–1869

435

1886• Haymarket

Square riot

HISTORY

Chapter OverviewVisit the American Vision

Web site at tav.glencoe.com

and click on Chapter

Overviews—Chapter 14 to

preview chapter information.

This painting by twentieth-century artist Aaron Bohrod captures the dynamism of an

industrializing nation. Bohrod titled his work The Big Blow: the Bessemer Process.

T. Roosevelt1901–1909▲

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B. Harrison1889–1893

McKinley1897–1901

Cleveland1893–1897

1895 1905

1892• Homestead

strike occurs

1894• Pullman strike

begins

1901• J.P. Morgan

forms U.S. Steel

1903• Women’s Trade

Union League

founded

1892• Rudolf Diesel patents

diesel engine

1896• Athens hosts first

modern Olympic

games

1900• Boxer Rebellion

begins in China

http://tav.glencoe.com

On October 21, 1879, Thomas Alva Edison and his team of workers were too

excited to sleep. For weeks they had worked to create an electric incandescent lamp, or

lightbulb, that would burn for more than a few minutes. For much of the 1800s, inven-

tors had struggled to develop a form of lighting that would be cheaper, safer, and

brighter than traditional methods such as candles, whale oil, kerosene, and gas. If

Edison and his team could do it, they would change the world. Finally, after weeks of

dedicated effort, they turned night into day. Edison later recalled:

“We sat and looked and the lamp continued to burn and the longer it burned the more

fascinated we were. None of us could go to bed and there was no sleep for over 40 hours;

we sat and just watched it with anxiety growing into elation. It lasted about 45 hours and

then I said, ‘If it will burn 40 hours now I know I can make it burn a hundred.’”—quoted in Eyewitness to America

1859

Edwin Drake

drills first oil well

436 CHAPTER 14 Industrialization

✦ 1890

The United States IndustrializesAlthough the Industrial Revolution began in the United States in the early 1800s, the

nation was still largely a farming country when the Civil War erupted. Out of a popula-

tion of more than 30 million, only 1.3 million Americans worked in industry in 1860.

After the Civil War, industry rapidly expanded, and millions of Americans left their farms

to work in mines and factories.

By the early 1900s, Americans had transformed the United States into the world’s

leading industrial nation. By 1914 the nation’s gross national product (GNP)—the total

The Rise of Industry

Main IdeaAmerican industry grew rapidly after the

Civil War, bringing revolutionary changes

to American society.

Key Terms and Namesgross national product, Edwin Drake,

laissez-faire, entrepreneur, Morrill Tariff,

Alexander Graham Bell, Thomas Alva

Edison

Reading StrategyOrganizing As you read about the

changes brought about by industrializa-

tion, complete a graphic organizer similar

to the one below listing the causes of

industrialization.

Reading Objectives• Identify the effects of expanding popu-

lation on industry.

• Explain the effects of technological

innovations such as the telephone and

telegraph on American development.

Section ThemeEconomic Factors The free enterprise

system nurtured the growth of American

industry.

1865

Thaddeus Lowe

invents ice machine

c. 1893

Northrop automatic

loom introduced

✦ 1860 ✦ 1870 ✦ 1880

Causes

United States

Becomes an

Industrial Nat ion

1876

Alexander Graham Bell

invents telephone

1879

Thomas Edison

perfects lightbulb

Thomas Edison

value of all goods and services produced by a

country—was eight times greater than it had been

when the Civil War ended.

Natural Resources An abundance of raw materials

was one reason for the nation’s industrial success. The

United States contained vast natural resources upon

which industry in the 1800s depended, including

water, timber, coal, iron, and copper. The presence of

these resources meant that American companies

could obtain them cheaply and did not have to import

them from other countries. Many of the nation’s

resources were located in the mountains of the

American West. The settlement of this region after the

Civil War helped to accelerate industrialization, as

did the construction of the transcontinental railroad.

Railroads brought settlers and miners to the region,

and carried the resources back to factories in the East.

At the same time, a new resource, petroleum,

began to be exploited. Even before the invention of

the automobile, petroleum was in high demand

because it could be turned into kerosene. Kerosene

was used in lanterns and stoves. The American oil

industry was built on the demand for kerosene. It

began in western Pennsylvania, where residents had

long noticed oil bubbling to the surface of area

springs and streams. In 1859 Edwin Drake drilled

the first oil well near Titusville, Pennsylvania. By

1900 oil fields from Pennsylvania to Texas had been

opened. As oil production rose, it fueled economic

expansion.

A Large Workforce The human resources avail-

able to American industry were as important as nat-

ural resources in enabling the nation to industrialize

rapidly. Between 1860 and 1910, the population of

the United States almost tripled. This population

provided industry with a large workforce and also

created greater demand for the consumer goods that

factories produced.

Population growth stemmed from two causes—

large families and a flood of immigrants. American

industry began to grow at a time when social and

economic conditions in China and eastern Europe

convinced many people to leave their nations and

move to the United States in search of a better life.

Between 1870 and 1910, roughly 20 million immi-

grants arrived in the United States. These multitudes

added to the growing industrial workforce, helping

factories increase their production and furthering

demand for industrial products.

Explaining How did oil production

affect the American economy?

Reading Check

CHAPTER 14 Industrialization 437

N

S

EW

200 kilometers0Lambert Equal-Area projection

200 miles0

40°N

80°W90°W

Chicago

Pittsburgh

New York City

Washington, D.C.

Boston

Major Industries, c. 1900

Coal miningIron orePrairieChief manu-facturing citiesIron/Steel mills

Oil field

Railroad

Sawmills

Early

Pennsylvania

oil well

1. Interpreting Maps Where were most industrial cities in

the Northeast located?

2. Applying Geography Skills What natural resources

contributed to making Pittsburgh, Pennsylvania, a major

steel center?

Free EnterpriseAnother important factor that enabled the United

States to industrialize rapidly was the free enterprise

system. In the late 1800s, many Americans embraced

the idea of laissez-faire (leh·say·FAR), literally “let

do,” a French phrase meaning “let people do as they

choose.” Supporters of laissez-faire believe the govern-

ment should not interfere in the economy other than to

protect private property rights and maintain peace.

These supporters argue that if the government regu-

lates the economy, it increases costs and eventually

hurts society more than it helps.

Laissez-faire relies on supply and demand rather

than the government to regulate prices and wages.

Supporters claim that a free market with competing

companies leads to greater efficiency and creates

more wealth for everyone. Laissez-faire advocates

also support low taxes to ensure that private individ-

uals, not the government, will make most of the deci-

sions about how the nation’s wealth is spent. They

also believe that the government’s debt should be

kept limited since money the government borrows

from banks is not available to be loaned to individu-

als for their own uses.

In the United States, the profit motive attracted

people of high ability and ambition into business.

American entrepreneurs—people who risk their cap-

ital in organizing and running a business—appreci-

ated the challenges and rewards of building a

business and making profits for themselves.

In the late 1800s, the prospect of making money in

manufacturing and transportation attracted many

entrepreneurs. The savings that New Englanders

accumulated through trade, fishing, whaling, textile

mills, and shoe manufacturing helped build hundreds

of factories and thousands of miles of railroad track.

An equally important source of private capital was

Europe, especially Great Britain. Foreign investors

saw more opportunity for profit and growth in the

United States than at home, and their money also

helped to fund the nation’s industrial buildup.

Explaining What does it mean

when a government has a laissez-faire economic policy?

Government’s Role in IndustrialismIn many respects, the United States practiced

laissez-faire economics in the late 1800s. State and

federal governments kept taxes and spending

low and did not impose costly regulations on

industry. Nor did they try to control wages and

prices. In other ways, the government went beyond

laissez-faire and adopted policies intended to help

industry, although these policies frequently pro-

duced results other than what had been intended.

Since the early 1800s, the struggle between the

northeastern states and the southern states had

shaped the economic debate in the United States.

Northern leaders wanted high tariffs to protect

American industry from foreign competition. They

also sought federal subsidies for companies build-

ing roads, canals, and railroads to the west.

Southern leaders opposed subsidizing internal

improvements, and they favored low tariffs to pro-

mote trade and to keep the cost of imported manu-

factured goods low.

The Civil War ended this debate. When the South

seceded, the Republicans were left in control of

Congress. They quickly passed the Morrill Tariff,

Reading Check


1852

Elisha Otis,

elevator brake1864

George Pullman,

rail sleeping car

✦ 1850

1876

Alexander Graham

Bell, telephone1865

Thaddeus Lowe,

ice machine

1874

Stephen Dudley Field,

electric streetcar

✦ 1865

American Inventions


1877

Thomas Edison,

phonograph

1883

Jan E. Matzeliger,

shoemaking machine

1893

Charles and J. Frank Duryea,

gasoline-powered car1887

Granville T. Woods,

electromechanical

brake

1879

Thomas Edison,

incandescent lightbulb

1879

James Ritty, cash register

✦ 1895✦ 1880

reversing years of declining tariffs. By the end of the

Civil War, tariffs had nearly tripled. Congress also

gave vast tracts of western land and nearly $65 mil-

lion in loans to western railroads. The government

also sold public lands with mineral resources for

much less than their market value. Historians still

dispute whether these policies helped to industrial-

ize the country.

Supporters of laissez-faire generally favor free

trade and oppose subsidies, believing that tariffs and

subsidies drive up prices and protect inefficient com-

panies. They point out that one reason the United

States industrialized so rapidly in the 1800s was

because it was one of the largest free trade areas in

the world. Unlike Europe, which was divided into

dozens of states, each with tariffs, the entire United

States was open to trade. The Constitution bans

states from imposing tariffs, and there were few fed-

eral regulations to impede the movement of goods

across the country. Similarly, the United States prac-

ticed free trade in labor, placing very few restrictions

on immigration.

High tariffs, however, contradicted laissez-faire

ideas and hurt many Americans. When the United

States raised tariffs against foreign goods, other

countries raised their tariffs against American goods.

This hurt American companies trying to sell goods

overseas, and in particular, it hurt farmers who sold

their products to Europe. Ironically, the problems

farmers faced may have helped speed up industrial-

ization, as many rural Americans decided to leave

their farms and take jobs in the new factories.

Despite the problems tariffs created for trade,

many business leaders and members of Congress

believed they were necessary. Much of Western

Europe had already industrialized, and few believed

that the new American industries could compete

with the large established European factories unless

tariffs were put in place to protect them. By the early

1900s, many American industries were large and

highly competitive. Business leaders increasingly

began to push for free trade because they believed

they could compete internationally and win.

Analyzing Do you think govern-

ment policies at this time helped or hindered industrialization?

Why?

New InventionsA flood of important inventions helped increase

the nation’s productive capacity and improved the

network of transportation and communications that

was vital to the nation’s industrial growth. New

inventions led to the founding of new corporations,

which produced new wealth and new jobs.

TECHNOLOGY

Bell and the Telephone One of the most dramatic

inventions in the late 1800s came in the field of com-

munications. In 1874 a young Scottish-American

inventor named Alexander Graham Bell suggested

the idea of a telephone to his assistant, Thomas

Watson. Watson recalled, “He had an idea by which

he believed it would be possible to talk by tele-

graph.” Bell intended to make an electrical current of

varying intensity transmit sound.

Bell worked until 1876 before he succeeded in trans-

mitting his voice. Picking up the crude telephone, he

called to the next room, “Come here, Watson, I want

you.” Watson heard and came. The telephone

Reading Check

revolutionized both business and personal communi-cation. In 1877 Bell and others organized the BellTelephone Company, which eventually became theAmerican Telephone and Telegraph Company (AT&T).

Edison and Electricity Perhaps the most famousinventor of the late 1800s was Thomas Alva Edison.His laboratory at Menlo Park, New Jersey, staffed byskilled assistants, became the forerunner of the mod-ern research laboratory. Edison stood as a symbol forthe emerging age of technology.

Edison first achieved international fame in 1877with the invention of the phonograph. Two yearslater, he perfected the lightbulb and the electric gen-erator. His laboratory then went on to invent orimprove several other major devices, including thebattery, the dictaphone, and the motion picture.

In 1882 an Edison company began to transformAmerican society when it started supplying electricpower to New York City customers. In 1889 severalEdison companies merged to form the Edison Gen-eral Electric Company, which today is known as GE.

Technology’s Impact As knowledge about technol-ogy grew, almost everyone in the United States feltits effects. Shortly after the Civil War, ThaddeusLowe invented the ice machine, the basis of the refrig-erator. In the early 1870s, Gustavus Swift hired anengineer to develop a refrigerated railroad car. In 1877Swift shipped the first refrigerated load of fresh meat.The widespread use of refrigeration kept food freshlonger and reduced the risk of food poisoning.

The textile industry had long depended on ma-chines to turn fibers into cloth. By the mid-1800s, theintroduction of the Northrop automatic loom allowedcloth to be made at an even faster rate. Bobbins, whichpreviously had been changed by hand, were nowchanged automatically without stopping the loom.

Great changes also took place in the clothingindustry. Standard sizes, developed from measure-ments taken of Union soldiers during the Civil War,were used in the manufacture of ready-made clothes.Power-driven sewing machines and cloth cuttersrapidly moved the clothing business from small tai-lor shops to large factories.

Similar changes took place in shoemaking. Largefactories began using new processes and inventionsto mass-produce shoes. They could make shoes moreefficiently than cobblers and sell them for lowerprices. By 1900 local cobblers had nearly disap-peared. Prices of many other products also droppedas the United States industrialized.

Technology’s impact also included improved con-nections among people. In 1866 Cyrus Field laid atelegraph cable across the Atlantic Ocean. Thistransatlantic cable provided instant contact betweenthe United States and Europe. Another innovationwas the radio. By the 1920s, radios had become com-mon in American homes, and radio stations sprangup throughout the United States.

Explaining How did the use of

electric power affect the economic development of the United

States?

Reading Check

Writing About History


Invention Effects

telephone

lightbulb

automatic loom

Checking for Understanding

1. Define: gross national product, laissez-faire, entrepreneur.

2. Identify: Edwin Drake, Morrill Tariff,Alexander Graham Bell, Thomas AlvaEdison.

3. Explain how an abundance of naturalresources contributed to economicgrowth in the United States in the late1800s.

Reviewing Themes

4. Economic Factors How did theprinciples of the free enterprise system,laissez-faire, and profit motiveencourage the rise of industry?

Critical Thinking

5. Synthesizing What role did the federalgovernment play in increasing indus-trialization in the United States after theCivil War?

6. Organizing Use a graphic organizersimilar to the one below to indicatehow the inventions listed affected thenature of American work and business.

Analyzing Visuals

7. Applying Time Lines Copy the timeline on pages 438 and 439 onto a separate sheet of paper. Add otherinventions you have learned about tothe time line in proper chronologicalorder. Be sure to include the date foreach invention.

8. Descriptive Writing Imagine you are ayoung person living in this country inthe late 1800s. Choose one of theinventions discussed in the section, andwrite a journal entry describing itsimpact on your life. Use standard gram-mar, spelling, sentence structure, andpunctuation.

revolutionized both business and personal communi-cation. In 1877 Bell and others organized the BellTelephone Company, which eventually became theAmerican Telephone and Telegraph Company (AT&T).

Edison and Electricity Perhaps the most famousinventor of the late 1800s was Thomas Alva Edison.His laboratory at Menlo Park, New Jersey, staffed byskilled assistants, became the forerunner of the mod-ern research laboratory. Edison stood as a symbol forthe emerging age of technology.

Edison first achieved international fame in 1877with the invention of the phonograph. Two yearslater, he perfected the lightbulb and the electric gen-erator. His laboratory then went on to invent orimprove several other major devices, including thebattery, the dictaphone, and the motion picture.

In 1882 an Edison company began to transformAmerican society when it started supplying electricpower to New York City customers. In 1889 severalEdison companies merged to form the Edison Gen-eral Electric Company, which today is known as GE.

Technology’s Impact As knowledge about technol-ogy grew, almost everyone in the United States feltits effects. Shortly after the Civil War, ThaddeusLowe invented the ice machine, the basis of the refrig-erator. In the early 1870s, Gustavus Swift hired anengineer to develop a refrigerated railroad car. In 1877Swift shipped the first refrigerated load of fresh meat.The widespread use of refrigeration kept food freshlonger and reduced the risk of food poisoning.

The textile industry had long depended on ma-chines to turn fibers into cloth. By the mid-1800s, theintroduction of the Northrop automatic loom allowedcloth to be made at an even faster rate. Bobbins, whichpreviously had been changed by hand, were nowchanged automatically without stopping the loom.

Great changes also took place in the clothingindustry. Standard sizes, developed from measure-ments taken of Union soldiers during the Civil War,were used in the manufacture of ready-made clothes.Power-driven sewing machines and cloth cuttersrapidly moved the clothing business from small tai-lor shops to large factories.

Similar changes took place in shoemaking. Largefactories began using new processes and inventionsto mass-produce shoes. They could make shoes moreefficiently than cobblers and sell them for lowerprices. By 1900 local cobblers had nearly disap-peared. Prices of many other products also droppedas the United States industrialized.

Technology’s impact also included improved con-nections among people. In 1866 Cyrus Field laid atelegraph cable across the Atlantic Ocean. Thistransatlantic cable provided instant contact betweenthe United States and Europe. Another innovationwas the radio. By the 1920s, radios had become com-mon in American homes, and radio stations sprangup throughout the United States.

Explaining How did the use of

electric power affect the economic development of the United

States?

Reading Check



Invention Effects

telephone

lightbulb

automatic loom


1. Define: gross national product, laissez-faire, entrepreneur.

2. Identify: Edwin Drake, Morrill Tariff,Alexander Graham Bell, Thomas AlvaEdison.

3. Explain how an abundance of naturalresources contributed to economicgrowth in the United States in the late1800s.

Reviewing Themes

4. Economic Factors How did theprinciples of the free enterprise system,laissez-faire, and profit motiveencourage the rise of industry?

Critical Thinking

5. Synthesizing What role did the federalgovernment play in increasing indus-trialization in the United States after theCivil War?

6. Organizing Use a graphic organizersimilar to the one below to indicatehow the inventions listed affected thenature of American work and business.

Analyzing Visuals

7. Applying Time Lines Copy the timeline on pages 438 and 439 onto a separate sheet of paper. Add otherinventions you have learned about tothe time line in proper chronologicalorder. Be sure to include the date foreach invention.

8. Descriptive Writing Imagine you are ayoung person living in this country inthe late 1800s. Choose one of theinventions discussed in the section, andwrite a journal entry describing itsimpact on your life. Use standard gram-mar, spelling, sentence structure, andpunctuation.

441

Critical Thinking

The Wright Brothers Triumph at Kitty HawkWhy Learn the Skill?

Just as you are about to leave home to catch your

school bus, you hear a radio report. Firefighters are

battling a blaze near the bus garage. Your bus is

late. Although no one told you, you know that the

fire disrupted the bus schedule. You have made an

inference. From the limited facts available, you

formed a conclusion. By combining facts and gen-

eral knowledge, you inferred that the fire trucks

delayed your bus.

Learning the Skill

Learning how to make inferences will help you

draw conclusions about particular situations. To

make accurate inferences, follow these steps:

• Read or listen carefully for stated facts and ideas.

• Review what you already know about the same

topic or situation.

• Use logic and common sense to form a conclu-

sion about the topic.

• If possible, find information that proves or dis-

proves your inference.

Practicing the Skill

Read the following passage about early air-

planes, and then answer the questions that follow.

On December 8, 1903, Samuel Langley was ready forhis second attempt at flying a manned, self-propelledaircraft. This had never been done before.

Langley used a $50,000 U.S. government grant tobuild a plane based on unmanned aircraft designs,adding a very powerful engine. The plane broke apart ontakeoff and crashed into the Potomac River.

In contrast, Wilbur and Orville Wright used a littlemore than $1,000 of their personal savings to build theiraircraft. The brothers carefully studied the problems withprevious planes and designed one with better wings, amore efficient propeller, and a strong but light engine.On December 17, 1903, these intrepid Americans madethe first manned, powered flight in history on the sanddunes of Kitty Hawk, North Carolina.

1 What are the facts regarding Langley’s attempt?

2 What are the facts regarding the Wright broth-

ers’ attempt?

3 What inferences might you draw based on the

success of the Wright brothers and failure of

Langley?

Skills Assessment

Complete the Practicing Skills questions on

page 461 and the Chapter 14 Skill Reinforcement

Activity to assess your mastery of this skill.

Applying the Skill

Making Inferences Preview the biography of Mary

Harris “Mother” Jones on page 456, and then answer

these questions.

1. What kind of work did Jones’s husband do before

he died?

2. How did Jones travel to West Virginia while work-

ing as an organizer for the United Mine Workers?

3. Based on these facts, what inference can you make

about Mary Jones? What inference can you make

about how the people in the camps felt about her?

Glencoe’s Skillbuilder Interactive Workbook

CD-ROM, Level 2, provides instruction and

practice in key social studies skills.

First flight at Kitty Hawk, December 17, 1903

MakingInferences


Linking the Nation In 1865 the United States had about 35,000 miles of railroad track, almost all of it east

of the Mississippi River. After the Civil War, railroad construction expanded dramati-

cally, linking the distant regions of the nation in a transportation network. By 1900 the

United States, now a booming industrial power, boasted over 200,000 miles of track.

At Promontory Summit, Utah, on May 10, 1869, hundreds of spectators gathered to

watch a historic event. Dignitaries from the East and the West met to hammer gold and sil-

ver spikes into the final rails that would join two great railroad lines—the Union Pacific and

Central Pacific—and span the entire country.

Telegraph offices around the country stood ready to receive news that the last spike had

been driven. When the news arrived, bells pealed across the nation, and even the Liberty

Bell was rung. In Chicago a seven-mile procession paraded through the streets, and the

pealings of church bells resonated throughout the nation’s small towns. General Grenville

Dodge, who had overseen part of the construction, observed:

“The trains pulled up facing each other, each crowded with workmen who sought advan-

tageous positions to witness the ceremonies. . . . The officers and invited guests formed on

each side of the track. . . . Prayer was offered; a number of spikes were driven in the two

adjoining rails . . . and thus the two roads were welded into one great trunk line from the

Atlantic to the Pacific.”—quoted in Mine Eyes Have Seen

The Railroads

Main IdeaAfter the Civil War, the rapid construction

of railroads accelerated the nation’s

industrialization and linked the country

together.

Key Terms and NamesPacific Railway Act, Grenville Dodge,

Leland Stanford, Cornelius Vanderbilt,

time zone, land grant, Jay Gould, Crédit

Mobilier, James J. Hill

Reading StrategyOrganizing As you read about the devel-

opment of a nationwide rail network,

complete a graphic organizer similar to

the one below listing the effects of this rail

network on the nation.

Reading Objectives• Discuss ways in which the railroads

spurred industrial growth.

• Analyze how the railroads were

financed and how they grew.

Section ThemeIndividual Action The railroads pro-

vided new ways for some Americans to

amass wealth.

1869

First transcontinental

railroad completed

✦ 1875 ✦ 1885✦ 1870 ✦ 1880

1872

Crédit Mobilier scandal

takes place

1873

First direct rail service between

New York and Chicago begins

1883

Time zones instituted

Effects

Nationwide Rail

Network

Grenville Dodge

Engineering Victory The Union Pacific and Central Pacific were joined near

Ogden, Utah. The last spike driven was made of gold. It was quickly removed and

kept as a symbol. What did the event mean for the nation’s commerce?

History

The railroad boom began in 1862 when President

Abraham Lincoln signed the Pacific Railway Act.This act provided for the construction of a transconti-

nental railroad by two corporations, the Union

Pacific and the Central Pacific railroad companies.

To encourage rapid construction, the government

offered each company land along its right-of-way.

Feverish competition between the two companies

developed, as each sought to obtain as much public

land and money as possible.

The Union Pacific and Grenville Dodge Under

the direction of engineer Grenville Dodge, a former

Union general, the Union Pacific began pushing

westward from Omaha, Nebraska, in 1865.

The laborers faced blizzards in the mountains,

scorching heat in the desert, and sometimes angry

Native Americans. Labor, money, and engineering

problems plagued the supervisors of the project. As

Dodge observed:

“At one time we were using at least ten thousand

animals, and most of the time from eight to ten thou-

sand laborers. . . . To supply one mile of track with

material and supplies required about forty cars. . . .

Everything—rails, ties, bridging, fastenings, all

railway supplies, fuel for locomotives and trains, and

supplies for men and animals on the entire work—

had to be transported from the Missouri River.”—quoted in The Growth of the American Republic

The railroad workers included Civil War veterans,

new immigrants from Ireland recruited especially for

the task, frustrated miners and farmers, cooks, adven-

turers, and ex-convicts. At the height of the project, the

Union Pacific employed about 10,000 workers. While

most of the laborers camped along the line, about one-

fourth of them slept three-deep in bunk beds on rolling

boarding cars. Camp life was rough, dirty, and danger-

ous, with lots of gambling, hard drinking, and fighting.

The Big Four and the Central Pacific The Central

Pacific Railroad began as the dream of engineer

Theodore Dehone Judah, who convinced the

California legislature to organize a state railroad con-

vention to support his idea. He sold stock in his

fledgling Central Pacific Railroad Company to four

Sacramento merchants: grocer Leland Stanford, shop

owner Charley Crocker, and hardware store owners

Mark Hopkins and Collis P. Huntington.

These so-called “Big Four” eventually made huge

fortunes from their investment. Leland Stanford

became governor of California and later served as aUnited States senator after founding StanfordUniversity in 1885.

Because of a shortage of labor in California, theCentral Pacific Railroad hired about 10,000 workersfrom China. All the equipment—rails, cars, locomo-tives, and machinery—was shipped from the East,either around Cape Horn at the tip of SouthAmerica or over the Isthmus of Panama in CentralAmerica.

Evaluating How did the supply dif-

ficulties of the Union and Central Railroads differ?

Railroads Spur GrowthThe transcontinental railroad was the first of many

lines that began to crisscross the nation after the CivilWar. This expansion spurred American industrialgrowth. By linking the nation, railroads helpedincrease the size of markets for many products. Hugeconsumers themselves, the railroads also stimulatedthe economy by spending extraordinary amounts ofmoney on steel, coal, timber, and other necessities.

Linking Other Lines In the early 1800s, most rail-roads had been built to promote specific cities or toserve local needs. By 1865 hundreds of small

unconnected lines existed.The challenge for easterncapitalists was to create asingle rail transportationsystem from this maze ofsmall companies.

Railroad consolidationproceeded rapidly from1865 to 1900. Large raillines took over about 400small railroads, and by1890 the Pennsylvania Rail-road was a consolidationof 73 smaller companies.Eventually seven giant systems with terminals inmajor cities and scores of branches reaching into thecountryside controlled most rail traffic.

One of the most famous and successful railroadconsolidators was Cornelius Vanderbilt, a formerboat captain who had built the largest steamboatfleet in America. By 1869 Vanderbilt had purchasedand merged three short New York railroads to formthe New York Central, running from New York Cityto Buffalo. Within four years he had extended hiscontrol over lines all the way to Chicago, whichenabled him to offer the first direct rail servicebetween New York City and Chicago. In 1871Vanderbilt began construction of New York’s GrandCentral terminal.

The Benefits of a National System Before the1880s each community set its clocks by the sun’sposition in the sky at high noon. At noon in Chicago,for example, it was 12:50 P.M. in Washington, D.C.,12:09 P.M. in Louisville, Kentucky, and 11:41 A.M. inSt. Paul, Minnesota. Local time interfered with trainscheduling and at times even threatened passengersafety. When two trains traveled on the same track,collisions could result from scheduling errors causedby variations in time.

To make rail service safer and more reliable, in1883 the American Railway Association divided thecountry into four time zones in regions where thesame time was kept. The federal government ratifiedthis change in 1918.

Large integrated railroad systems benefited thenation. They were able to shift cars from one sectionof the country to another according to seasonal needsand in order to speed long-distance transportation.At the same time, new locomotive technology andthe introduction of air brakes enabled railroads toput longer and heavier trains on their lines. The newrail systems, along with more powerful locomotives,

Reading Check

The Trans-Siberian Railroad

Nearly 50 years after Americans completed their

transcontinental railroad, the Russians hammered the

final spike into their own cross-country rail line. Begun in

1891 and completed in 1916, the Trans-Siberian Railroad

was the longest in the world, running nearly 5,800 miles

(9,330 km) from Moscow in the west to Vladivostok on

the Sea of Japan in the east. Like the American railroads,

the Trans-Siberian line

opened up the way for

trade and settlement

throughout Russia’s fron-

tier—an arctic, windswept

land known as Siberia.

How might the construc-tion of a railroad affecttowns along the line? Trans-Siberian

Railroad

1,000 kilometers0Two-point Equidistant projection

1,000 miles0

N

SE

W

110°E

30°N

50°N

RU S S I A

Vladivostok

Moscow

Student WebActivity Visit theAmerican Vision Website at tav.glencoe.comand click on StudentWeb Activities—Chapter 14 for anactivity on industrialization.

HISTORY


became governor of California and later served as aUnited States senator after founding StanfordUniversity in 1885.

Because of a shortage of labor in California, theCentral Pacific Railroad hired about 10,000 workersfrom China. All the equipment—rails, cars, locomo-tives, and machinery—was shipped from the East,either around Cape Horn at the tip of SouthAmerica or over the Isthmus of Panama in CentralAmerica.

Evaluating How did the supply dif-

ficulties of the Union and Central Railroads differ?

Railroads Spur GrowthThe transcontinental railroad was the first of many

lines that began to crisscross the nation after the CivilWar. This expansion spurred American industrialgrowth. By linking the nation, railroads helpedincrease the size of markets for many products. Hugeconsumers themselves, the railroads also stimulatedthe economy by spending extraordinary amounts ofmoney on steel, coal, timber, and other necessities.

Linking Other Lines In the early 1800s, most rail-roads had been built to promote specific cities or toserve local needs. By 1865 hundreds of small

unconnected lines existed.The challenge for easterncapitalists was to create asingle rail transportationsystem from this maze ofsmall companies.

Railroad consolidationproceeded rapidly from1865 to 1900. Large raillines took over about 400small railroads, and by1890 the Pennsylvania Rail-road was a consolidationof 73 smaller companies.Eventually seven giant systems with terminals inmajor cities and scores of branches reaching into thecountryside controlled most rail traffic.

One of the most famous and successful railroadconsolidators was Cornelius Vanderbilt, a formerboat captain who had built the largest steamboatfleet in America. By 1869 Vanderbilt had purchasedand merged three short New York railroads to formthe New York Central, running from New York Cityto Buffalo. Within four years he had extended hiscontrol over lines all the way to Chicago, whichenabled him to offer the first direct rail servicebetween New York City and Chicago. In 1871Vanderbilt began construction of New York’s GrandCentral terminal.

The Benefits of a National System Before the1880s each community set its clocks by the sun’sposition in the sky at high noon. At noon in Chicago,for example, it was 12:50 P.M. in Washington, D.C.,12:09 P.M. in Louisville, Kentucky, and 11:41 A.M. inSt. Paul, Minnesota. Local time interfered with trainscheduling and at times even threatened passengersafety. When two trains traveled on the same track,collisions could result from scheduling errors causedby variations in time.

To make rail service safer and more reliable, in1883 the American Railway Association divided thecountry into four time zones in regions where thesame time was kept. The federal government ratifiedthis change in 1918.

Large integrated railroad systems benefited thenation. They were able to shift cars from one sectionof the country to another according to seasonal needsand in order to speed long-distance transportation.At the same time, new locomotive technology andthe introduction of air brakes enabled railroads toput longer and heavier trains on their lines. The newrail systems, along with more powerful locomotives,

Reading Check

The Trans-Siberian Railroad

Nearly 50 years after Americans completed their

transcontinental railroad, the Russians hammered the

final spike into their own cross-country rail line. Begun in

1891 and completed in 1916, the Trans-Siberian Railroad

was the longest in the world, running nearly 5,800 miles

(9,330 km) from Moscow in the west to Vladivostok on

the Sea of Japan in the east. Like the American railroads,

the Trans-Siberian line

opened up the way for

trade and settlement

throughout Russia’s fron-

tier—an arctic, windswept

land known as Siberia.

How might the construc-tion of a railroad affecttowns along the line? Trans-Siberian

Railroad

1,000 kilometers0Two-point Equidistant projection

1,000 miles0

N

SE

W

110°E

30°N

50°N

RU S S I A

Vladivostok

Moscow

Student WebActivity Visit theAmerican Vision Website at tav.glencoe.comand click on StudentWeb Activities—Chapter 14 for anactivity on industrialization.

HISTORY



Lambert Equal-Area projection600 kilometers0

600 miles0

N

SEW

80°W

70°W

110°W

120°W

50°N

40°N

30°N

20°N

Gulf of Mexico

ATLaNTic

Ocean

PaCIFic

Ocean

Boston

Chicago

San Francisco Washington, D.C.

New York City

Railroads, 1870 and 1890

1. Interpreting Maps What part of the United States saw

the greatest expansion in rail lines by 1890?

2. Applying Geography Skills In which time zone did the

Central Pacific originate?

Source: Historical Statistics of the United States:Colonial Times to 1970.

Tota

l Mile

s o

f R

ailr

oad

Op

erat

ing

(in

th

ou

san

ds)

175

150

125

100

75

50

25

0

Miles of Track, 1870–1890

189018851880

Year18751870

Pacific Time ZoneMountain Time ZoneCentral Time ZoneEastern Time ZoneRailroads built by 1870Railroads built by 1890

*Time zones and borders shown as of 1890


made railroad operation so efficient that the average

rate per mile for a ton of freight dropped from two

cents in 1860 to three-fourths of a cent in 1900.

The nationwide rail network also helped unite

Americans in different regions. Looking back at a

quarter century of railroad travel, the Omaha DailyRepublican observed in 1883 that railroads had

“made the people of the country homogeneous,

breaking through the peculiarities and provin-

cialisms which marked separate and unmingling

sections.” This was, perhaps, an overstatement, but

it recognized a significant contribution that railroads

made to the nation.

Explaining Why did the American

Railway Association divide the country into four time zones?

The Land Grant System Building and operating railroad lines, especially

across the vast unsettled regions of the West, often

required more money than most private investors

could raise on their own. To encourage railroad con-

struction, the federal government gave land grantsto many railroad companies. Railroads would then

sell the land to settlers, real estate companies, and

other businesses to raise the money they needed to

build the railroad.

In the 1850s, the federal government granted indi-

vidual states over 28 million acres of public lands to

give to the railroads. After the Pacific Railway Acts of

1862 and 1864, the government gave the land directly

to the railroad companies.

During the 1850s and 1860s, the federal land grant

system awarded railroad companies over 120 mil-

lion acres of land, an area larger than New England,

New York, and Pennsylvania combined. Several rail-

road companies, including the Union Pacific and

the Central Pacific, earned enough money from the

government’s generous land grants to cover much of

the cost of building their lines.

Summarizing How did the govern-

ment help finance railroads?

Robber BaronsThe great wealth many railroad entrepreneurs

acquired in the late 1800s led to accusations that they

had built their fortunes by swindling investors and

Reading Check

Reading Check




1. Define: time zone, land grant.

2. Identify: Pacific Railway Act, Grenville

Dodge, Leland Stanford, Cornelius

Vanderbilt, Jay Gould, Crédit Mobilier,

James J. Hill.

3. Explain the provisions of the Pacific

Railway Act.

Reviewing Themes

4. Individual Action How did Grenville

Dodge contribute to the economic

growth of the United States in the late

1800s?

Critical Thinking

5. Synthesizing How did railroad expan-

sion in the United States lead to indus-

trial growth?

6. Organizing Use a graphic organizer

similar to the one below to list the

different ways that railroads were

financed.

Analyzing Visuals

7. Examining Maps and Graphs Study

the map and the graph on page 445.

Then make up a quiz of at least five

questions based on the information

presented.

8. Persuasive Writing Take on the role

of an employee of a major railroad

corporation. Your job assignment is

to write an advertisement to recruit

workers for your corporation. After

writing the advertisement, present it

to your class.

taxpayers, bribing government officials, and cheating

on their contracts and debts. The person with proba-

bly the worst reputation for this kind of activity was

Jay Gould, who often practiced “insider trading.” He

used information he received as a railroad owner to

manipulate stock prices to his benefit.

Bribery occurred frequently in this era, partly

because the state and federal governments were so

deeply entangled in funding the railroads. Railroad

investors quickly discovered that they could make

more money by acquiring government land grants

than by operating the railroad. As a result, many

investors bribed members of Congress and the state

legislatures to vote for more grants.

The Crédit Mobilier Scandal The corruption in the

railroad industry became public in 1872 when the

Crédit Mobilier scandal erupted. Crédit Mobilierwas a construction company set up by several stock-

holders of the Union Pacific, including Oakes Ames,

a member of Congress. Acting for both the Union

Pacific and Crédit Mobilier, the investors signed con-

tracts with themselves. Crédit Mobilier greatly over-

charged Union Pacific for the work it did, and since

the same investors controlled both companies, the

railroad agreed to pay the inflated bills.

By the time the Union Pacific railroad was com-

pleted, the investors had made several million dol-

lars, but the railroad itself had used up its federal

grants and was almost bankrupt. To convince

Congress to give the railroad more grants, Ames gave

other members of Congress shares in the Union

Pacific at a price well below their market value.

During the election campaign of 1872, a disgrun-

tled associate of Ames sent a letter to the New York

Sun listing the members of Congress who had

accepted shares. The scandal led to an investigation

that implicated several members of Congress, includ-

ing Speaker of the House James G. Blaine and James

Garfield, who later became president. It also revealed

that Vice President Schuyler Colfax had accepted

stock from the railroad.

The Great Northern The Crédit Mobilier scandal

provided sensational newspaper headlines. It created

the impression that all railroad entrepreneurs were

robber barons—people who loot an industry and give

nothing back—but the term was not always deserved.

One railroad entrepreneur who was clearly not a

robber baron was James J. Hill. Hill built and oper-

ated the Great Northern Railroad from St. Paul,

Minnesota, to Everett, Washington, without any fed-

eral land grants or subsidies. He built the Great

Northern across good land, carefully planning his

route to pass by towns in the region. To increase busi-

ness, he offered low fares to settlers who homesteaded

along his route. He then identified American products

that were in demand in China, including cotton, tex-

tiles, and flour, and arranged to haul those goods to

Washington for shipment to Asia. This enabled the

railroad to earn money by hauling goods both east and

west, instead of simply sending lumber and farm

products east and coming back empty, as many other

railroads did. Operating without government subsi-

dies or land grants, the Great Northern became the

most successful transcontinental railroad and the only

one that was not eventually forced into bankruptcy.

Describing How was the Great

Northern different from other railroads of the time?

Reading Check

Ways Railroads

Were Financed

In the 1860s, the oil industry in the United States was highly competitive. One highly efficient

company was Standard Oil, owned by John D. Rockefeller and his associates. Because his company

shipped so much oil, Rockefeller was able to negotiate rebates, or refunds, from railroads that wanted

his business. This gave his company an advantage, and he began to pressure other oil companies to

sell out to him.

Oil producer Franklin Tarbell pledged never to surrender. Tarbell’s daughter Ida later recalled her

father’s indignation over Rockefeller’s maneuvers:

“It was as if somebody had tried to crowd me off the road. . . . There were rules, you couldn’t use

the road unless you obeyed those rules. . . . The railroads—so said my father—ran through the valley

by the consent of the people; they had given them a right of way. The road on which I trotted was a

right of way. One man had the same right as another, but the railroads had given to one something

they would not give to another. . . . The strong wrested from the railroads the privilege of preying

upon the weak.”—quoted in All in the Day’s Work

Big Business

Main IdeaAfter the Civil War, big business assumeda more prominent role in American life.

Key Terms and Namescorporation, stockholder, stock,economies of scale, fixed costs, operatingcosts, pool, Andrew Carnegie, Bessemerprocess, vertical integration, horizontalintegration, monopoly, trust, holdingcompany

Reading StrategyOrganizing As you read about the rise ofcorporations in the United States, com-plete a graphic organizer similar to theone below to describe the steps largebusiness owners took to weaken or elimi-nate competition.

Reading Objectives• Analyze how large corporations came

to dominate American business.• Evaluate how Andrew Carnegie’s inno-

vations transformed the steel industry.

Section Theme Economic Factors Large national corpo-rations formed in the United States in themid-1800s and contributed to greaterproduction.

✦1895✦1865 ✦1885


1862John D. Rockefellerbuys first oil refinery

The Rise of Big BusinessBefore the Civil War, the personal wealth of a few people operating in partnership

financed most businesses, including many early factories. Most manufacturing enterpriseswere very small. By 1900 everything had changed. Big businesses dominated the economy,operating vast complexes of factories, warehouses, offices, and distribution facilities.

1875Andrew Carnegie openssteel mill in Pittsburgh

1879Woolworth’s chainstore opens

1882Dow Jones &Company founded

1901J.P. Morgan formsU.S. Steel

Slashed prices

temporarily

✦1875

In the 1860s, the oil industry in the United States was highly competitive. One highly efficient

company was Standard Oil, owned by John D. Rockefeller and his associates. Because his company

shipped so much oil, Rockefeller was able to negotiate rebates, or refunds, from railroads that wanted

his business. This gave his company an advantage, and he began to pressure other oil companies to

sell out to him.

Oil producer Franklin Tarbell pledged never to surrender. Tarbell’s daughter Ida later recalled her

father’s indignation over Rockefeller’s maneuvers:

“It was as if somebody had tried to crowd me off the road. . . . There were rules, you couldn’t use

the road unless you obeyed those rules. . . . The railroads—so said my father—ran through the valley

by the consent of the people; they had given them a right of way. The road on which I trotted was a

right of way. One man had the same right as another, but the railroads had given to one something

they would not give to another. . . . The strong wrested from the railroads the privilege of preying

upon the weak.”—quoted in All in the Day’s Work

Big Business

Main IdeaAfter the Civil War, big business assumeda more prominent role in American life.

Key Terms and Namescorporation, stockholder, stock,economies of scale, fixed costs, operatingcosts, pool, Andrew Carnegie, Bessemerprocess, vertical integration, horizontalintegration, monopoly, trust, holdingcompany

Reading StrategyOrganizing As you read about the rise ofcorporations in the United States, com-plete a graphic organizer similar to theone below to describe the steps largebusiness owners took to weaken or elimi-nate competition.

Reading Objectives• Analyze how large corporations came

to dominate American business.• Evaluate how Andrew Carnegie’s inno-

vations transformed the steel industry.

Section Theme Economic Factors Large national corpo-rations formed in the United States in themid-1800s and contributed to greaterproduction.

✦1895✦1865 ✦1885


1862John D. Rockefellerbuys first oil refinery

The Rise of Big BusinessBefore the Civil War, the personal wealth of a few people operating in partnership

financed most businesses, including many early factories. Most manufacturing enterpriseswere very small. By 1900 everything had changed. Big businesses dominated the economy,operating vast complexes of factories, warehouses, offices, and distribution facilities.

1875Andrew Carnegie openssteel mill in Pittsburgh

1879Woolworth’s chainstore opens

1882Dow Jones &Company founded

1901J.P. Morgan formsU.S. Steel

Slashed prices

temporarily

✦1875


ECONOMICS

The Role of Corporations Big business would

not have been possible without the corporation. A

corporation is an organization owned by many

people but treated by law as though it were a single

person. A corporation can own property, pay taxes,

make contracts, and sue and be sued. The people

who own the corporation are called stockholdersbecause they own shares of ownership called stock.Issuing stock allows a corporation to raise large

amounts of money for big projects while spreading

out the financial risk.

Before the 1830s, there were few corporations in

the United States because entrepreneurs had to con-

vince a state legislature to issue them a charter.

Beginning in the 1830s, however, states began pass-

ing general incorporation laws, allowing companies

to become corporations and issue stock without char-

ters from the legislature.

Economies of Scale With the money they raised

from the sale of stock, corporations could invest in

new technologies, hire a large workforce, and pur-

chase many machines, greatly increasing their effi-

ciency. This enabled them to achieve what is called

economies of scale, in which corporations make

goods more cheaply because they produce so much

so quickly using large manufacturing facilities.

All businesses have two kinds of costs, fixed costs

and operating (or variable) costs. Fixed costs are

costs a company has to pay, whether or not it is oper-

ating. For example, a company would have to pay its

loans, mortgages, and taxes, regardless of whether it

was operating. Operating costs are costs that occur

when running a company, such as paying wages and

shipping charges and buying raw materials and

other supplies.

The small manufacturing companies that had been

typical before the Civil War usually had very low fixed

costs but very high operating costs. If sales dropped, it

was cheaper to shut down and wait for better eco-

nomic conditions. By comparison, big companies had

very high fixed costs because it took so much money

to build and maintain a factory. Compared to their

fixed costs, big businesses had low operating costs.

Wages and transportation costs were such a small

part of a corporation’s costs that it made sense to

keep operating, even in a recession.

In these circumstances, big corporations had sev-

eral advantages. They could produce goods more

cheaply and efficiently. They could continue to oper-

ate in poor economic times by cutting prices to

increase sales, rather than shutting down. Many were

also able to negotiate rebates from the railroads, thus

lowering their operating costs even further.

Small businesses with high operating costs found

it difficult to compete against large corporations, and

many were forced out of business. At the time, many

people criticized corporations for cutting prices and

negotiating rebates. They believed the corporations

were behaving unethically by using their wealth to

drive small companies out of business. In many

cases, the changing nature of business organization

and the new importance of fixed costs that caused

competition to become so severe forced many small

companies out of business.

Describing What factors led to the

rise of big business in the United States?

The Consolidation of IndustryMany corporate leaders did not like the intense

competition that had been forced on them. Although

falling prices benefited consumers, they cut into prof-

its. To stop prices from falling, many companies

organized pools, or agreements to maintain prices at

a certain level.

American courts and legislatures were suspicious

of pools because they interfered with competition

and property rights. As a result, companies that

formed pools had no legal protection and could not

enforce their agreements in court. Pools generally did

not last long. They broke apart whenever one mem-

ber cut prices to steal the market share from another,

which then allowed competition to resume. By the

1870s, competition had reduced many industries to a

few large and highly efficient corporations.

Andrew Carnegie and Steel The remarkable life of

Andrew Carnegie illustrates many of the different fac-

tors that led to industrialism and the rise of big busi-

ness in the United States. He was born in Scotland, the

son of a poor hand weaver who emigrated to the

United States in 1848. At age 12, Carnegie went to

work as a bobbin boy in a textile factory earning $1.20

per week. After two years, he became a messenger in a

telegraph office, then served as private secretary to

Thomas Scott, a superintendent and later president

of the Pennsylvania Railroad. Carnegie’s energy

impressed Scott, and when Scott was promoted,

Carnegie succeeded him as superintendent.

As a railroad supervisor, Carnegie knew that he

could make a lot of money by investing in companies

that served the railroad industry. He bought shares in

iron mills and factories that made sleeping cars and

Reading Check

locomotives. He also invested in a company that built

railroad bridges. In his early 30s, he was earning

$50,000 per year, and he decided to quit his job with

the railroad to concentrate on his own business affairs.

As part of his business activities, Carnegie fre-

quently traveled to Europe to sell railroad bonds. On

one trip, he met the English inventor, Sir Henry

Bessemer, who had invented a new process for mak-

ing high quality steel efficiently and cheaply. After

meeting Bessemer, Carnegie decided to concentrate

his investments in the steel industry. He opened a

steel company in Pittsburgh in 1875 and quickly

adapted his steel mills to use the Bessemer process.Carnegie often boasted about how cheaply he could

produce steel:

“Two pounds of iron stone mined upon Lake

Superior and transported nine hundred miles to

Pittsburgh; one pound and one-half of coal mined and

manufactured into coke, and transported to Pittsburgh;

one-half pound of lime, mined and transported to

Pittsburgh; a small amount of manganese ore mined in

Virginia and brought to Pittsburgh—and these four

pounds of materials manufactured into one pound of

steel, for which the consumer pays one cent.”—quoted in The Growth of the American Republic

Vertical and Horizontal Integration To increase

manufacturing efficiency even further, Carnegie took

the next step in building a big business. He did this

by beginning the vertical integration of the steel

industry. A vertically integrated company owns all of

the different businesses on which it depends for its

operation. Instead of paying companies for coal,

lime, and iron, Carnegie’s company bought coal

mines, limestone quarries, and iron ore fields.

Vertical integration saved companies money while

enabling big companies to become even bigger.

Successful business leaders like Carnegie also

pushed for horizontal integration, or combining

many firms engaged in the same type of business into

one large corporation. Horizontal integration took

place frequently as companies competed. When a

company began to lose market share, it would often

sell out to competitors to create a larger organization.

By 1880, for example, a series of buyouts had enabled

Rockefeller’s Standard Oil to gain control of approxi-

mately 90 percent of the oil refining industry in the

United States. When a single company achieves con-

trol of an entire market, it becomes a monopoly.Many Americans feared monopolies because they

believed that a company with a monopoly could

charge whatever it wanted for its products. Others,

however, supported monopolies. They believed that

monopolies had to keep prices low because raising

prices would encourage competitors to reappear and

offer the products for a lower price. In some indus-

tries companies had a virtual monopoly in the United

States but were competing on a global scale. Standard

Oil, for example, came very close to having a monop-

oly in the United States, but competition with other


Vertical Integration Horizontal Integration

Independent Oil Refineries

U.S. Oil Company

Purchase of CompetingCompanies in Same Industry

Cattle

Slaughterhouse

Refrigerated Railroad Cars

Purchase of Companiesat All Levels of Production

Cooled Warehouses

Meat Packing Plants

Delivery Wagons

Ace Meat

Industries

Horizontal and vertical integration were the two

most common business combinations in the late

1800s.

Evaluating Which combination do you think would

yield the most efficient business? Why?

oil companies throughout the world forced theStandard Oil Company to keep its prices low in thelate 1800s and early 1900s.

Trusts By the late 1800s, many Americans hadgrown suspicious of large corporations and fearedthe power of monopolies. To preserve competitionand prevent horizontal integration, many statesmade it illegal for one company to own stock inanother without specific permission from the statelegislature. In 1882 Standard Oil formed the firsttrust, a new way of merging businesses that did notviolate the laws against owning other companies. Atrust is a legal concept that allows one person to man-age another person’s property. The person who man-ages another person’s property is called a trustee.

Instead of buying a company outright, StandardOil had stockholders give their stocks to a group ofStandard Oil trustees. In exchange, the stockholdersreceived shares in the trust, which entitled them to aportion of the trust’s profits. Since the trustees didnot own the stock but were merely managing it, they

were not violating any laws. This arrangementenabled the trustees to control a group of companiesas if they were one large merged company.

Holding Companies Beginning in 1889 the state ofNew Jersey further accelerated the rise of big businesswith a new general incorporation law. This lawallowed corporations chartered in New Jersey to ownstock in other businesses without any need for speciallegislative action. Many companies immediately usedthe New Jersey law to create a new organizationcalled a holding company. A holding company doesnot produce anything itself. Instead, it owns the stockof companies that do produce goods. The holdingcompany controls all of the companies it owns, effec-tively merging them into one large enterprise. By 1904the United States had 318 holding companies.Together these giant corporations controlled over5,300 factories and were worth more than $7 billion.

Explaining What techniques did

corporations use to consolidate their industries?

Reading Check


MOMENTinHISTORYMOMENTinHISTORYLABOR SAVERSAmerican inventiveness andthe nation’s growing industrialmight combined to provideturn-of-the-century consumerswith an ever-increasing array ofproducts. Here, a homemakerwields an early electric vacuumcleaner. Mass-produced house-hold devices had a tremendousimpact on the lifestyles andbuying habits of millions ofmiddle-class Americans. Incities, huge shopping empo-riums replaced the cozy drygoods stores of the 1800s. Evenrural customers could buy analmost endless variety of mer-chandise from mail-order cata-logues such as Sears, Roebuckand Montgomery Ward.

oil companies throughout the world forced theStandard Oil Company to keep its prices low in thelate 1800s and early 1900s.

Trusts By the late 1800s, many Americans hadgrown suspicious of large corporations and fearedthe power of monopolies. To preserve competitionand prevent horizontal integration, many statesmade it illegal for one company to own stock inanother without specific permission from the statelegislature. In 1882 Standard Oil formed the firsttrust, a new way of merging businesses that did notviolate the laws against owning other companies. Atrust is a legal concept that allows one person to man-age another person’s property. The person who man-ages another person’s property is called a trustee.

Instead of buying a company outright, StandardOil had stockholders give their stocks to a group ofStandard Oil trustees. In exchange, the stockholdersreceived shares in the trust, which entitled them to aportion of the trust’s profits. Since the trustees didnot own the stock but were merely managing it, they

were not violating any laws. This arrangementenabled the trustees to control a group of companiesas if they were one large merged company.

Holding Companies Beginning in 1889 the state ofNew Jersey further accelerated the rise of big businesswith a new general incorporation law. This lawallowed corporations chartered in New Jersey to ownstock in other businesses without any need for speciallegislative action. Many companies immediately usedthe New Jersey law to create a new organizationcalled a holding company. A holding company doesnot produce anything itself. Instead, it owns the stockof companies that do produce goods. The holdingcompany controls all of the companies it owns, effec-tively merging them into one large enterprise. By 1904the United States had 318 holding companies.Together these giant corporations controlled over5,300 factories and were worth more than $7 billion.

Explaining What techniques did

corporations use to consolidate their industries?

Reading Check


MOMENTinHISTORYMOMENTinHISTORYLABOR SAVERSAmerican inventiveness andthe nation’s growing industrialmight combined to provideturn-of-the-century consumerswith an ever-increasing array ofproducts. Here, a homemakerwields an early electric vacuumcleaner. Mass-produced house-hold devices had a tremendousimpact on the lifestyles andbuying habits of millions ofmiddle-class Americans. Incities, huge shopping empo-riums replaced the cozy drygoods stores of the 1800s. Evenrural customers could buy analmost endless variety of mer-chandise from mail-order cata-logues such as Sears, Roebuckand Montgomery Ward.




1. Define: corporation, economies ofscale, fixed costs, operating costs, pool, vertical integration, horizontalintegration, monopoly, trust, holdingcompany.

2. Identify: stockholder, stock, AndrewCarnegie, Bessemer process.

3. List the new methods of advertisingand selling that helped push consumergoods in the late 1800s.

Reviewing Themes

4. Economic Factors What factorsallowed corporations to develop in theUnited States in the late 1800s?

Critical Thinking

5. Forming an Opinion Do you think anindividual today can rise from “rags toriches” like Andrew Carnegie did? Whyor why not?

6. Organizing Use a graphic organizerlike the one below to list ways businessleaders in the late 1800s tried to elimi-nate competition.

Analyzing Visuals

7. Analyzing Photographs Study thephotograph on page 450 of a womanusing an early electric vacuum cleaner.How would you compare this to today’svacuum cleaners? How do you thinknew mass-produced appliances affectedthe lives of women in this era?

Selling the ProductThe vast array of products that American indus-

tries churned out led retailers to look for new ways tomarket and sell goods. N.W. Ayer and Son ofPhiladelphia, for example, developed bold new for-mats for advertising. Large display ads with illustra-tions replaced the small-type line ads that had beenstandard in newspapers. By 1900 retailers werespending over $90 million a year on advertising,approximately 10 times what they had spent in 1865.Advertising attracted readers to the newest retailbusiness, the department store.

In 1877 advertisements billed John Wanamaker’snew Philadelphia department store, the Grand Depot,as the “largest space in the world devoted to retail sell-ing on a single floor.” When Wanamaker’s opened,only a handful of department stores existed in theUnited States; soon hundreds sprang up. Departmentstores changed the idea of shopping by bringing ahuge array of different products together in a large,elegant building. They created an atmosphere thatmade shopping seem glamorous and exciting.

Chain stores, a group of similar stores owned by thesame company, first appeared in the mid-1800s. In con-trast to department stores, which offered many serv-ices, chain stores focused on thrift, offering low pricesinstead of elaborate service and decor. Woolworth’s, achain store that opened in 1879, became one of themost successful retail chains in American history.

To reach the millions of people who lived in ruralareas in the late 1800s—far from chain stores or department stores—retailers began issuing

mail-order catalogs. Two of the largest mail-orderretailers were Montgomery Ward and Sears, Roebuck.Their huge catalogs, widely distributed through themail, used attractive illustrations and friendlydescriptions to advertise thousands of items for sale.

Identifying What innovations did

retailers introduce in the late 1800s to sell goods to consumers?

Reading Check

Attempts to

Eliminate Competition

The New York Stock Exchange In 1792 business-people met in New York City to establish a stockexchange—a marketplace for buying and sellingstock in companies. At first, the new stock exchangewas located under a buttonwood tree on Wall Street.

The organization took its present name, the NewYork Stock Exchange, in 1863. Huge amounts of thecapital required for the nation’s industrialization afterthe Civil War passed through the New York StockExchange.

As stock trading grew, investors across the nationneeded financial news. In 1882 Henry Charles Dowand Edward D. Jones founded Dow Jones & Company.This new company sent bulletins on theday’s business to Wall Street’s financialhouses. The day’s last deliverycontained a news sheet,which became the WallStreet Journal in July 1889.

8. Expository Writing Write a newspa-per editorial in which you explain whyentrepreneurs such as John D.Rockefeller and Andrew Carnegie werea positive or a negative force on theU.S. economy in the late 1800s.




1. Define: corporation, economies ofscale, fixed costs, operating costs, pool, vertical integration, horizontalintegration, monopoly, trust, holdingcompany.

2. Identify: stockholder, stock, AndrewCarnegie, Bessemer process.

3. List the new methods of advertisingand selling that helped push consumergoods in the late 1800s.

Reviewing Themes

4. Economic Factors What factorsallowed corporations to develop in theUnited States in the late 1800s?

Critical Thinking

5. Forming an Opinion Do you think anindividual today can rise from “rags toriches” like Andrew Carnegie did? Whyor why not?

6. Organizing Use a graphic organizerlike the one below to list ways businessleaders in the late 1800s tried to elimi-nate competition.

Analyzing Visuals

7. Analyzing Photographs Study thephotograph on page 450 of a womanusing an early electric vacuum cleaner.How would you compare this to today’svacuum cleaners? How do you thinknew mass-produced appliances affectedthe lives of women in this era?

Selling the ProductThe vast array of products that American indus-

tries churned out led retailers to look for new ways tomarket and sell goods. N.W. Ayer and Son ofPhiladelphia, for example, developed bold new for-mats for advertising. Large display ads with illustra-tions replaced the small-type line ads that had beenstandard in newspapers. By 1900 retailers werespending over $90 million a year on advertising,approximately 10 times what they had spent in 1865.Advertising attracted readers to the newest retailbusiness, the department store.

In 1877 advertisements billed John Wanamaker’snew Philadelphia department store, the Grand Depot,as the “largest space in the world devoted to retail sell-ing on a single floor.” When Wanamaker’s opened,only a handful of department stores existed in theUnited States; soon hundreds sprang up. Departmentstores changed the idea of shopping by bringing ahuge array of different products together in a large,elegant building. They created an atmosphere thatmade shopping seem glamorous and exciting.

Chain stores, a group of similar stores owned by thesame company, first appeared in the mid-1800s. In con-trast to department stores, which offered many serv-ices, chain stores focused on thrift, offering low pricesinstead of elaborate service and decor. Woolworth’s, achain store that opened in 1879, became one of themost successful retail chains in American history.

To reach the millions of people who lived in ruralareas in the late 1800s—far from chain stores or department stores—retailers began issuing

mail-order catalogs. Two of the largest mail-orderretailers were Montgomery Ward and Sears, Roebuck.Their huge catalogs, widely distributed through themail, used attractive illustrations and friendlydescriptions to advertise thousands of items for sale.

Identifying What innovations did

retailers introduce in the late 1800s to sell goods to consumers?

Reading Check

Attempts to

Eliminate Competition

The New York Stock Exchange In 1792 business-people met in New York City to establish a stockexchange—a marketplace for buying and sellingstock in companies. At first, the new stock exchangewas located under a buttonwood tree on Wall Street.

The organization took its present name, the NewYork Stock Exchange, in 1863. Huge amounts of thecapital required for the nation’s industrialization afterthe Civil War passed through the New York StockExchange.

As stock trading grew, investors across the nationneeded financial news. In 1882 Henry Charles Dowand Edward D. Jones founded Dow Jones & Company.This new company sent bulletins on theday’s business to Wall Street’s financialhouses. The day’s last deliverycontained a news sheet,which became the WallStreet Journal in July 1889.

8. Expository Writing Write a newspa-per editorial in which you explain whyentrepreneurs such as John D.Rockefeller and Andrew Carnegie werea positive or a negative force on theU.S. economy in the late 1800s.


Investigating Standard OilB

y the 1880s, the Standard Oil Company, under the direction of John D.

Rockefeller and his associates, had gained control of more than 90 per-

cent of the oil refining business in the United States. Did Standard Oil

use unfair tactics? The United States Industrial Commission investigated, call-

ing Rockefeller himself to testify. Rockefeller said his success was due to the

efficiency of his company. George Rice, an independent refiner from Marietta,

Ohio, told the Industrial Commission that Standard Oil’s advantage was crim-

inal collusion with the railroads. Was he right? You’re the historian.

Read the following excerpts from the Industrial Commission hearings of 1899. Then

complete the questions and activities on the next page.

John D. Rockefeller

Standard Oil stock

Question: To what advantages, or

favors, or methods of manage-

ment do you ascribe chiefly the

success of the Standard Oil

Company?

Answer [Rockefeller]: I ascribe the

success of the Standard to its con-

sistent policy to make the volume

of its business large through the

merits and cheapness of its prod-

ucts. It has spared no expense in

finding, securing, and utilizing

the best and cheapest methods of

manufacture. It has sought for the

best superintendents and work-

men and paid the best wages. It

has not hesitated to sacrifice old

machinery and old plants for new

and better ones. It has placed its

manufactories at the points

where they could supply markets

at the least expense. It has not

only sought markets for its prin-

cipal products, but for all possible

by-products, sparing no expense

in introducing them to the public.

It has not hesitated to invest mil-

lions of dollars in methods of

cheapening the gathering and

distribution of oils by pipe lines,

special cars, tank steamers, and

tank wagons. . . .

Question: What are, in your judg-

ment, the chief advantages from

industrial combinations—(a)

financially to stockholders; (b) to

the public?

Answer: All the advantages which

can be derived from a coopera-

tion of person and aggregation of

capital. . . . It is too late to argue

about advantages of industrial

combinations. They are a neces-

sity. And if Americans are to have

the privilege of extending their

business in all the States of the

Union, and into foreign countries

as well, they are a necessity on a

large scale, and require the

agency of more than one corpora-

tion. Their chief advantages are:

1. Command of necessary capital.

2. Extension of limits of business.

3. Increase the number of per-

sons interested in the business.

4. Economy in the business.

5. Improvements and economies

which are derived from knowl-

edge of many interested per-

sons of wide experience.

6. Power to give the public

improved products at less

prices and still make a profit

from stockholders.

7. Permanent work and good

wages for laborers.

Cartoon criticizing Standard Oil


Oil derricks

Understanding the Issue1. What potential advantages could

companies like Standard Oil offer

consumers?

2. What did George Rice believe to be

the reason Standard Oil was so

successful?

3. How would you assess the credibility

of the two accounts?

Activities1. Investigate Today many industries,

unions, and special interest groups

lobby Congress for favorable legisla-

tion. What are the most powerful

groups? How do they operate?

2. Check the News Are there any com-

panies that recently have been inves-

tigated for unfair or monopolistic

practices? Collect headlines and news

articles and create a bulletin board

display.

I am a citizen of the United States.

. . . Producer of petroleum for

more than 30 years, and a refiner

of same for 20 years, but my refin-

ery has been shut down during

the past 3 years, owing to the

powerful and all-prevailing

machinations of the Standard Oil

Trust, in criminal collusion and

conspiracy with the railroads to

destroy my business of 20 years of

patient industry, toil, and money

in building up, wholly by and

through unlawful freight discrim-

inations. I have been driven from

pillar to post, from one railway

line to another, for 20 years, in the

absolutely vain endeavor to get

equal and just freight rates with

the Standard Oil Trust, so as to be

able to run my refinery at any-

thing approaching a profit, but

which I have been utterly

unable to do. I have had to conse-

quently shut down, with my busi-

ness absolutely ruined and my

refinery idle. This has been a very

sad, bitter, and ruinous experi-

ence for me to endure, but I have

endeavored to the best of my cir-

cumstances and ability to combat

it the utmost I could for many a

long waiting year, expecting relief

through the honest and proper

execution of our laws, which have

as yet, however, never come. . . .

Outside of rebates or freight dis-

criminations I had no show with

the Standard Oil trust, because of

their unlawfully acquired monop-

oly, by which they could tem-

porarily cut only my customers’

prices, and below cost, leaving the

balance of the town, nine-tenths,

uncut. This they can easily do

without any appreciable harm to

their general trade, and thus effec-

tually wipe out all competition, as

fully set forth. Standard Oil prices

generally were so high that I

could sell my goods 2 to 3 cents a

gallon below their prices and

make a nice profit, but these sav-

age attacks and cuts upon my

customers’ goods, and their con-

sequent loss, plainly showed

them their power for evil, and the

uselessness to contend against

such odds, and they would buy

no more of my oil. . . .

1877Great RailroadStrike


✦1885 ✦1905

Working in the United StatesLife for workers in industrial America was difficult. As machines replaced skilled

labor, work became monotonous. Workers had to perform highly specific, repetitivetasks and could take little pride in their work. In addition, working conditions were

On September 6, 1869, hundreds of miners’ wives and children heard the repeated shrill blasts of

the Avondale Mine’s whistle, which signaled an accident. The families ran to the mine’s entry and

beheld a terrifying sight: hot smoke billowing from the mine shaft.

The owners of the Avondale Coal Mine in Luzerne County, Pennsylvania, had not built a second

entrance to their mine. Without an escape route, the 179 miners trapped below soon died. Songs to

commemorate the disaster later gave voice to the silenced victims:

“And as their souls ascended

To God who gave them breath

They plead against the company

Whose greed had caused their death”Following the deaths at Avondale, John Siney, an Irish immigrant and union leader, urged his fellow

miners to unionize:

“Men, if you must die with your boots on, die for your families, your homes, your country, but do

not longer consent to die like rats in a trap. . . .”—quoted in Labor’s Untold Story

Unions

Main IdeaIn an attempt to improve their workingconditions, industrial workers cametogether to form unions in the late 1800s.

Key Terms and Namesdeflation, trade union, industrial union,blacklist, lockout, Marxism, Knights ofLabor, arbitration, injunction, closed shop

Reading StrategySequencing As you read about theincrease of American labor unions in thelate 1800s, complete a time line similarto the one below by filling in the inci-dents of labor unrest discussed and theresults of each incident.

Reading Objectives• Describe industrial working conditions

in the United States in the late 1800s.• List the barriers to labor union growth.

Section ThemeIndividual Action People like SamuelGompers and Mother Jones strove to bal-ance the power of corporations with theneeds of workers.

✦1875 ✦1895

1886American Federationof Labor founded

1886Riot in Chicago’sHaymarket Square

1894Pullman Strike

1903Women’s Trade UnionLeague founded

1877

1877Great RailroadStrike


✦1885 ✦1905

Working in the United StatesLife for workers in industrial America was difficult. As machines replaced skilled

labor, work became monotonous. Workers had to perform highly specific, repetitivetasks and could take little pride in their work. In addition, working conditions were

On September 6, 1869, hundreds of miners’ wives and children heard the repeated shrill blasts of

the Avondale Mine’s whistle, which signaled an accident. The families ran to the mine’s entry and

beheld a terrifying sight: hot smoke billowing from the mine shaft.

The owners of the Avondale Coal Mine in Luzerne County, Pennsylvania, had not built a second

entrance to their mine. Without an escape route, the 179 miners trapped below soon died. Songs to

commemorate the disaster later gave voice to the silenced victims:

“And as their souls ascended

To God who gave them breath

They plead against the company

Whose greed had caused their death”Following the deaths at Avondale, John Siney, an Irish immigrant and union leader, urged his fellow

miners to unionize:

“Men, if you must die with your boots on, die for your families, your homes, your country, but do

not longer consent to die like rats in a trap. . . .”—quoted in Labor’s Untold Story

Unions

Main IdeaIn an attempt to improve their workingconditions, industrial workers cametogether to form unions in the late 1800s.

Key Terms and Namesdeflation, trade union, industrial union,blacklist, lockout, Marxism, Knights ofLabor, arbitration, injunction, closed shop

Reading StrategySequencing As you read about theincrease of American labor unions in thelate 1800s, complete a time line similarto the one below by filling in the inci-dents of labor unrest discussed and theresults of each incident.

Reading Objectives• Describe industrial working conditions

in the United States in the late 1800s.• List the barriers to labor union growth.

Section ThemeIndividual Action People like SamuelGompers and Mother Jones strove to bal-ance the power of corporations with theneeds of workers.

✦1875 ✦1895

1886American Federationof Labor founded

1886Riot in Chicago’sHaymarket Square

1894Pullman Strike

1903Women’s Trade UnionLeague founded

1877

often unhealthy and dangerous. Workers breathed inlint, dust, and toxic fumes. Heavy machines lackingsafety devices caused a high number of injuries.

Despite the difficult working conditions, industri-alism brought about a dramatic rise in the standardof living. While only a few entrepreneurs becamerich, real wages earned by the average worker roseby about 50 percent between 1860 and 1890.

Despite the rise in the standard of living, theuneven division of income between the wealthy andthe working class caused resentment among workers.In 1900 the average industrial worker made 22¢ perhour and worked 59 hours per week.

At the same time, an economic phenomenon ofthe late 1800s made relations between workers andemployers even more difficult. Between 1865 and1897, the United States experienced deflation, or arise in the value of money. Throughout the late1800s, deflation caused prices to fall, whichincreased the buying power of workers’ wages.Although companies cut wages regularly in the late1800s, prices fell even faster, so that wages wereactually still going up in buying power. Workers,however, believed that companies wanted to paythem less money for the samework. Eventually, many work-ers decided that the only wayto improve their working con-ditions was to organize unions.With a union, they could bar-gain collectively to negotiatehigher wages and better work-ing conditions.

Describing What aspects of

industrial life caused frustration for

workers in the late 1800s?

Early UnionsThere were two basic types

of industrial workers in theUnited States in the 1800s—craft workers and commonlaborers. Craft workers hadspecial skills and training.They included machinists, ironmolders, stonecutters, glass-blowers, shoemakers, printers,carpenters, and many others.Craft workers generallyreceived higher wages and

had more control over how they organized their timeon the shop floor. Common laborers had few skillsand received lower wages.

In the 1830s, as industrialism began to spread,craft workers began to form trade unions—unionslimited to people with specific skills. By 1873 therewere 32 national trade unions in the United States.Among the largest and most successful were the IronMolders’ International Union, the InternationalTypographical Union, and the Knights of St.Crispin—the shoemakers’ union.

Industry Opposes Unions Employers were oftenforced to recognize and negotiate with trade unionsbecause they represented workers whose skills theyneeded. However, employers generally regardedunions as illegitimate conspiracies that interferedwith their property rights. Owners of large corpora-tions particularly opposed industrial unions, whichunited all craft workers and common laborers in aparticular industry.

Companies used several techniques to preventunions from forming. They required workers to take

Reading Check

Unsafe Working Conditions Workers in the late 1800s often faced unsafe working conditions. Many began to

join labor unions in an attempt to improve these conditions. What unsafe conditions does this photograph of a

steel mill show?

History


often unhealthy and dangerous. Workers breathed inlint, dust, and toxic fumes. Heavy machines lackingsafety devices caused a high number of injuries.

Despite the difficult working conditions, industri-alism brought about a dramatic rise in the standardof living. While only a few entrepreneurs becamerich, real wages earned by the average worker roseby about 50 percent between 1860 and 1890.

Despite the rise in the standard of living, theuneven division of income between the wealthy andthe working class caused resentment among workers.In 1900 the average industrial worker made 22¢ perhour and worked 59 hours per week.

At the same time, an economic phenomenon ofthe late 1800s made relations between workers andemployers even more difficult. Between 1865 and1897, the United States experienced deflation, or arise in the value of money. Throughout the late1800s, deflation caused prices to fall, whichincreased the buying power of workers’ wages.Although companies cut wages regularly in the late1800s, prices fell even faster, so that wages wereactually still going up in buying power. Workers,however, believed that companies wanted to paythem less money for the samework. Eventually, many work-ers decided that the only wayto improve their working con-ditions was to organize unions.With a union, they could bar-gain collectively to negotiatehigher wages and better work-ing conditions.

Describing What aspects of

industrial life caused frustration for

workers in the late 1800s?

Early UnionsThere were two basic types

of industrial workers in theUnited States in the 1800s—craft workers and commonlaborers. Craft workers hadspecial skills and training.They included machinists, ironmolders, stonecutters, glass-blowers, shoemakers, printers,carpenters, and many others.Craft workers generallyreceived higher wages and

had more control over how they organized their timeon the shop floor. Common laborers had few skillsand received lower wages.

In the 1830s, as industrialism began to spread,craft workers began to form trade unions—unionslimited to people with specific skills. By 1873 therewere 32 national trade unions in the United States.Among the largest and most successful were the IronMolders’ International Union, the InternationalTypographical Union, and the Knights of St.Crispin—the shoemakers’ union.

Industry Opposes Unions Employers were oftenforced to recognize and negotiate with trade unionsbecause they represented workers whose skills theyneeded. However, employers generally regardedunions as illegitimate conspiracies that interferedwith their property rights. Owners of large corpora-tions particularly opposed industrial unions, whichunited all craft workers and common laborers in aparticular industry.

Companies used several techniques to preventunions from forming. They required workers to take

Reading Check

Unsafe Working Conditions Workers in the late 1800s often faced unsafe working conditions. Many began to

join labor unions in an attempt to improve these conditions. What unsafe conditions does this photograph of a

steel mill show?

History


oaths or sign contracts promising not to join a union,and they hired detectives to go undercover andidentify union organizers. Workers who tried toorganize a union or strike were fired and placed on ablacklist—a list of “troublemakers.” Once black-listed, a laborer could get a job only by changing res-idence, trade, or even his or her name.

If workers formed a union, companies often useda lockout to break it. They locked workers out of theproperty and refused to pay them. If the union calleda strike, employers would hire replacement workers,or strikebreakers, also known as scabs.

Political and Social Opposition Workers whowanted to organize a union faced several major prob-lems. There were no laws giving workers the right toorganize or requiring owners to negotiate with them.Courts frequently ruled that strikes were “conspira-cies in restraint of trade,” for which labor leadersmight be fined or jailed.

Unions also suffered from the perception that theythreatened American institutions. In the late 1800s,the ideas of Karl Marx, called Marxism, had becomevery influential in Europe. Marx argued that thebasic force shaping capitalist society was the classstruggle between workers and owners. He believed

that workers would eventually revolt, seize control ofthe factories, and overthrow the government.

Marxists claimed that after the revolution, the gov-ernment would seize all private property and create asocialist society where wealth was evenly divided.Eventually, Marx thought, the state would witheraway, leaving a Communist society where classes didnot exist. Marxism strongly shaped the thinking ofEuropean unions.

While many labor supporters agreed with Marx, afew supported anarchism. Anarchists believe thatsociety does not need any government. At the time,some believed that with only a few acts of violence,they could ignite a revolution to topple the govern-ment. In the late 1800s, anarchists assassinated gov-ernment officials and set off bombs all across Europe,hoping to trigger a revolution.

As Marxist and anarchist ideas spread in Europe,tens of thousands of European immigrants beganarriving in the United States. Nativism—anti-immigrant feelings—was already strong in theUnited States. As people began to associate immi-grant workers with revolution and anarchism, theybecame increasingly suspicious of unions. Thesefears, as well as the government’s duty to maintainlaw and order, often led officials to use the courts,

the police, and even the army tocrush strikes and break up unions.

Identifying

Why were some Americans suspicious of

Unions?

The Struggle toOrganize

Although workers attempted onmany occasions to create large indus-trial unions, they rarely succeeded. Inmany cases the confrontations withowners and the government led toviolence and bloodshed. In 1868William Sylvis, president of the IronMolders Union and leader of theNational Labor Union, wrote to KarlMarx to encourage Marx’s work andexpress his own hopes:

“Our cause is a common

one. . . . Go ahead in the good

work that you have undertaken,

until the most glorious success

crowns your efforts . . . monied

Reading Checki n H i s t o r yMother Jones 1830–1930

Mary Harris “Mother” Jones emi-grated to the United States from Irelandin 1835 at the age of five. Jonesbecame the nation’s most prominentwoman union leader after a tragicpersonal loss. In 1867 her husbandGeorge, a union organizer, and theirfour children died from yellow fever.

Widowed and childless, Jones movedto Chicago and opened a dressmaker’sshop. From her shop window, Jonescould see the effects of the economicdownturn of the 1870s: “poor shiveringwretches, jobless and hungry.” At nightshe attended rallies for the Knights ofLabor.

By 1890 Jones had become anorganizer for the United Mine Workers.In 1897 she traveled to West Virginia.The intrepid labor organizer trudgedfrom camp to camp along railroadtracks or rode atop farm wagons. Sheslept in a tent.

A journalist who followed Jones onher trip reported that Jones began herspeeches slowly, encouraging her listen-ers to “look on yourselves, and uponeach other. Let us consider this togetherfor I am one of you, and I know what itis to suffer.” Then Mother Jones wouldmake an impassioned plea for the min-ers to join the union. “You pity your-selves, but you do not pity yourbrothers, or you would stand togetherto help one another.”


oaths or sign contracts promising not to join a union,and they hired detectives to go undercover andidentify union organizers. Workers who tried toorganize a union or strike were fired and placed on ablacklist—a list of “troublemakers.” Once black-listed, a laborer could get a job only by changing res-idence, trade, or even his or her name.

If workers formed a union, companies often useda lockout to break it. They locked workers out of theproperty and refused to pay them. If the union calleda strike, employers would hire replacement workers,or strikebreakers, also known as scabs.

Political and Social Opposition Workers whowanted to organize a union faced several major prob-lems. There were no laws giving workers the right toorganize or requiring owners to negotiate with them.Courts frequently ruled that strikes were “conspira-cies in restraint of trade,” for which labor leadersmight be fined or jailed.

Unions also suffered from the perception that theythreatened American institutions. In the late 1800s,the ideas of Karl Marx, called Marxism, had becomevery influential in Europe. Marx argued that thebasic force shaping capitalist society was the classstruggle between workers and owners. He believed

that workers would eventually revolt, seize control ofthe factories, and overthrow the government.

Marxists claimed that after the revolution, the gov-ernment would seize all private property and create asocialist society where wealth was evenly divided.Eventually, Marx thought, the state would witheraway, leaving a Communist society where classes didnot exist. Marxism strongly shaped the thinking ofEuropean unions.

While many labor supporters agreed with Marx, afew supported anarchism. Anarchists believe thatsociety does not need any government. At the time,some believed that with only a few acts of violence,they could ignite a revolution to topple the govern-ment. In the late 1800s, anarchists assassinated gov-ernment officials and set off bombs all across Europe,hoping to trigger a revolution.

As Marxist and anarchist ideas spread in Europe,tens of thousands of European immigrants beganarriving in the United States. Nativism—anti-immigrant feelings—was already strong in theUnited States. As people began to associate immi-grant workers with revolution and anarchism, theybecame increasingly suspicious of unions. Thesefears, as well as the government’s duty to maintainlaw and order, often led officials to use the courts,

the police, and even the army tocrush strikes and break up unions.

Identifying

Why were some Americans suspicious of

Unions?

The Struggle toOrganize

Although workers attempted onmany occasions to create large indus-trial unions, they rarely succeeded. Inmany cases the confrontations withowners and the government led toviolence and bloodshed. In 1868William Sylvis, president of the IronMolders Union and leader of theNational Labor Union, wrote to KarlMarx to encourage Marx’s work andexpress his own hopes:

“Our cause is a common

one. . . . Go ahead in the good

work that you have undertaken,

until the most glorious success

crowns your efforts . . . monied

Reading Checki n H i s t o r yMother Jones 1830–1930

Mary Harris “Mother” Jones emi-grated to the United States from Irelandin 1835 at the age of five. Jonesbecame the nation’s most prominentwoman union leader after a tragicpersonal loss. In 1867 her husbandGeorge, a union organizer, and theirfour children died from yellow fever.

Widowed and childless, Jones movedto Chicago and opened a dressmaker’sshop. From her shop window, Jonescould see the effects of the economicdownturn of the 1870s: “poor shiveringwretches, jobless and hungry.” At nightshe attended rallies for the Knights ofLabor.

By 1890 Jones had become anorganizer for the United Mine Workers.In 1897 she traveled to West Virginia.The intrepid labor organizer trudgedfrom camp to camp along railroadtracks or rode atop farm wagons. Sheslept in a tent.

A journalist who followed Jones onher trip reported that Jones began herspeeches slowly, encouraging her listen-ers to “look on yourselves, and uponeach other. Let us consider this togetherfor I am one of you, and I know what itis to suffer.” Then Mother Jones wouldmake an impassioned plea for the min-ers to join the union. “You pity your-selves, but you do not pity yourbrothers, or you would stand togetherto help one another.”


power is fast eating up the substance of the people.

We have made war upon it, and we mean to win it. If

we can we will win through the ballot box; if not, we

will resort to sterner means. A little bloodletting is

sometimes necessary in desperate causes.”—quoted in Industrialism and

the American Worker

The Great Railroad Strike of 1877 In 1873 a

severe recession known as the Panic of 1873 struck

the American economy and forced many companies

to cut wages. In July 1877, as the recession continued,

several railroads announced another round of wage

cuts. This triggered the first nationwide labor protest.

The day after the cuts took effect, railroad workers in

Martinsburg, West Virginia, walked off the job and

blocked the tracks.

As word spread, railroad workers across the coun-

try walked off the job. The strike eventually involved

80,000 railroad workers in 11 states and affected two-

thirds of the nation’s railways. Angry strikers

smashed equipment, tore up tracks, and blocked rail

service in New York, Baltimore, Pittsburgh, St. Louis,

and Chicago. The governors of several states called

out their militias to stop the violence. In many places,

gun battles erupted between the militia and striking

workers.

Determined to stop the violence, President Hayes

ordered the army to open the railroad between

Philadelphia and Pittsburgh. He then sent troops to

Chicago, where the strike had paralyzed the entire

city. The troops restored order, but by the time the

strike ended, more than 100 people lay dead, and

millions of dollars of property had been destroyed.

The Knights of Labor The failure of the Great

Railroad Strike convinced many labor organizers that

workers across the nation needed to be better organ-

ized. By the late 1870s, enough workers had joined a

new organization, the Knights of Labor, to make it

the first nationwide industrial union.

The Knights called for an eight-hour workday and

a government bureau of labor statistics. They also

supported equal pay for women, the abolition of

child labor, and the creation of worker-owned facto-

ries. The Knights’ leaders initially opposed the use

of strikes, preferring to use boycotts to pressure

Coeurd’Alene,

1892, 1899

Leadville, 1896

Cripple Creek, 1903–04

Texas andPacific R.R.,

1886

Birmingham-Bessemer

1894

Haymarket Riot, 1886

Pullman, 1894

Homestead, 1892

BaltimoreRail Strike,

1877

TROPIC OF CANCER

40ºN

30ºN

120ºW110ºW

90ºW 80ºW

60ºW

70ºW

N

S

EW

400 kilometers0Lambert Equal-Area projection

400 miles0

Atlantic

Ocean

Gulf of Mexico

Pacific

Ocean

CANADAWASH.

MEXICO

OREG.

CALIF.

NEV.

IDAHO

MONT.

WYO.

UTAHCOLO.

ARIZ.TERR. N. MEX.

TERR.

N. DAK.

S. DAK.

NEBR.

KANS.

OKLA.TERR.

IND.TERR.

TEXASLA.

ARK.

MO.

IOWA

MINN.

WIS.

ILL.

MISS.ALA.

FLA.

GA.S.C.

N.C.TENN.

KY.

IND.

MICH.

OHIOW.VA. VA.

PA.

N.Y.

VT.

CONN.R.I.

MASS.N.H.

ME.

N.J.DEL.

MD.

1. Interpreting Maps In what part of the nation did most

of the strikes occur?

2. Applying Geography Skills Why did most of the labor

conflicts take place where they did?

Railroad strike

Miners' strike

Other strike or riot

Counties with strikeactivity, 1881–1894

No strikes reported

1890 border


Strikes and Labor Unrest, 1870–1890

employers. They also supported arbitration, aprocess in which an impartial third party helps work-ers and management reach an agreement.

In the early 1880s, the Knights began to use strikes,and they achieved great success initially. After strik-ing Knights convinced one of Jay Gould’s railroads toreverse wage cuts in 1885, membership in the unionleapt from 100,000 to 700,000 in less than a year. Thefollowing year, 1886, marked the peak of their suc-cess. In the spring of that year, an event known as theHaymarket Riot undermined the Knights’ reputa-tion, and the union rapidly declined.

The Haymarket Riot In the early 1880s, the move-ment for an eight-hour workday began to build sup-port. In 1886 organizers called for a nationwidestrike on May 1 to show support for the idea. On thatdate, strikes took place in many cities, includingChicago.

On May 3, a clash between strikers and police inChicago left one striker dead. The next evening, ananarchist group organized a meeting in Chicago’sHaymarket Square to protest the killing. Around3,000 people gathered to hear the speeches. Whenpolice entered the square, someone threw a bomb.The police opened fire, and workers shot back. Sevenpolice officers and four workers were killed.

Police arrested eight people for the bombing.Seven of those arrested were German immigrantsand advocates of anarchism. The incident hor-rified people across the country.

No one knew who threw the bomb.Although the evidence was weak, alleight men were convicted, and fourwere later executed. Unfortunately forthe Knights of Labor, one of the menarrested was a member of the union.The incident badly hurt the Knights’reputation, and they began to losemembers rapidly.

The Pullman Strike Although theHaymarket Riot set back the drive tocreate industrial unions, other labororganizers continued their efforts. In1893 railroad workers created the American RailwayUnion (ARU) under the leadership of Eugene V.Debs. One of the companies the ARU unionized wasthe Pullman Palace Car Company.

The Pullman Company was based in Illinois. Ithad built a town named Pullman near its factory andrequired its workers to live in the town and to buygoods from company stores. In 1893 a depression

struck the United States, causing the PullmanCompany to slash wages. The wage cuts made it dif-ficult for workers to pay their rent or the high pricesat the company stores. In May 1894, after Pullmanfired three workers who complained, a strike began.In support, the ARU stopped handling Pullman carsall across the United States.

The boycott of Pullman cars tied up railroads andthreatened to paralyze the economy. Determined to break the union, railroad managers arranged for U.S. mail cars to be attached to the Pullman cars.If the strikers refused to handle the Pullman cars,they would be interfering with the U.S. mail, aviolation of federal law. President Grover Clevelandthen sent in troops, claiming it was his responsi-bility to keep the mail running. When a federalcourt issued an injunction, or formal court order,directing the union to halt the boycott, both thestrike at Pullman and the ARU collapsed.

Analyzing Why did industrial

unions frequently fail in the late 1800s?

The American Federation of LaborAlthough large-scale industrial unions generally

failed in the late 1800s, trade unions continued to pros-per. In 1886 delegates from over 20 of the nation’s

trade unions organized the American Federationof Labor (AFL). The AFL’s first leader was

Samuel Gompers. His approach to laborrelations—which he called “plain and

simple” unionism—helped unions tobecome accepted in American society.

Gompers believed that unions shouldstay out of politics. He rejected socialistand communist ideas. Rather, hebelieved that the AFL should fight forsmall gains—such as higher wages andbetter working conditions—within theAmerican system. He was willing to usethe strike but preferred to negotiate.

Under Gompers’s leadership, theAFL had three main goals. First, it triedto convince companies to recognize

unions and to agree to collective bargaining. Second,it pushed for closed shops, meaning that companiescould only hire union members. Third, it promotedan eight-hour workday.

The AFL grew slowly, but by 1900 it was the biggestunion in the country, with over 500,000 members. Still,at that time, the AFL represented less than 15 percentof all non-farm workers. All unions, including railroad

Reading Check


Samuel Gompers

employers. They also supported arbitration, aprocess in which an impartial third party helps work-ers and management reach an agreement.

In the early 1880s, the Knights began to use strikes,and they achieved great success initially. After strik-ing Knights convinced one of Jay Gould’s railroads toreverse wage cuts in 1885, membership in the unionleapt from 100,000 to 700,000 in less than a year. Thefollowing year, 1886, marked the peak of their suc-cess. In the spring of that year, an event known as theHaymarket Riot undermined the Knights’ reputa-tion, and the union rapidly declined.

The Haymarket Riot In the early 1880s, the move-ment for an eight-hour workday began to build sup-port. In 1886 organizers called for a nationwidestrike on May 1 to show support for the idea. On thatdate, strikes took place in many cities, includingChicago.

On May 3, a clash between strikers and police inChicago left one striker dead. The next evening, ananarchist group organized a meeting in Chicago’sHaymarket Square to protest the killing. Around3,000 people gathered to hear the speeches. Whenpolice entered the square, someone threw a bomb.The police opened fire, and workers shot back. Sevenpolice officers and four workers were killed.

Police arrested eight people for the bombing.Seven of those arrested were German immigrantsand advocates of anarchism. The incident hor-rified people across the country.

No one knew who threw the bomb.Although the evidence was weak, alleight men were convicted, and fourwere later executed. Unfortunately forthe Knights of Labor, one of the menarrested was a member of the union.The incident badly hurt the Knights’reputation, and they began to losemembers rapidly.

The Pullman Strike Although theHaymarket Riot set back the drive tocreate industrial unions, other labororganizers continued their efforts. In1893 railroad workers created the American RailwayUnion (ARU) under the leadership of Eugene V.Debs. One of the companies the ARU unionized wasthe Pullman Palace Car Company.

The Pullman Company was based in Illinois. Ithad built a town named Pullman near its factory andrequired its workers to live in the town and to buygoods from company stores. In 1893 a depression

struck the United States, causing the PullmanCompany to slash wages. The wage cuts made it dif-ficult for workers to pay their rent or the high pricesat the company stores. In May 1894, after Pullmanfired three workers who complained, a strike began.In support, the ARU stopped handling Pullman carsall across the United States.

The boycott of Pullman cars tied up railroads andthreatened to paralyze the economy. Determined to break the union, railroad managers arranged for U.S. mail cars to be attached to the Pullman cars.If the strikers refused to handle the Pullman cars,they would be interfering with the U.S. mail, aviolation of federal law. President Grover Clevelandthen sent in troops, claiming it was his responsi-bility to keep the mail running. When a federalcourt issued an injunction, or formal court order,directing the union to halt the boycott, both thestrike at Pullman and the ARU collapsed.

Analyzing Why did industrial

unions frequently fail in the late 1800s?

The American Federation of LaborAlthough large-scale industrial unions generally

failed in the late 1800s, trade unions continued to pros-per. In 1886 delegates from over 20 of the nation’s

trade unions organized the American Federationof Labor (AFL). The AFL’s first leader was

Samuel Gompers. His approach to laborrelations—which he called “plain and

simple” unionism—helped unions tobecome accepted in American society.

Gompers believed that unions shouldstay out of politics. He rejected socialistand communist ideas. Rather, hebelieved that the AFL should fight forsmall gains—such as higher wages andbetter working conditions—within theAmerican system. He was willing to usethe strike but preferred to negotiate.

Under Gompers’s leadership, theAFL had three main goals. First, it triedto convince companies to recognize

unions and to agree to collective bargaining. Second,it pushed for closed shops, meaning that companiescould only hire union members. Third, it promotedan eight-hour workday.

The AFL grew slowly, but by 1900 it was the biggestunion in the country, with over 500,000 members. Still,at that time, the AFL represented less than 15 percentof all non-farm workers. All unions, including railroad

Reading Check


Samuel Gompers


unions, represented only 18 percent. As the 1900sbegan, the vast majority of workers remained unor-ganized, and unions were relatively weak.

Analyzing What AFL policies

contributed to its growth as a union?

Working WomenThroughout the 1800s, most wage-earning work-

ers in the United States were men. After the CivilWar, the number of women wage earners began toincrease. By 1900 women made up more than 18 per-cent of the labor force.

The type of jobs women did outside the home inthe late 1800s and early 1900s reflected society’s ideasabout what constituted “women’s work.” Roughlyone-third of women worked as domestic servants.Another third worked as teachers, nurses, salesclerks, and secretaries. The remaining third wereindustrial workers, but they were employed in lightindustrial jobs that people believed appropriate totheir gender. Many worked in the garment industryand food processing plants.

Regardless of their employment, women werepaid less than men even when they performed thesame jobs. It was assumed that a woman had a manhelping to support her, either her father or her hus-band, and that a man needed higher wages to sup-port a family. For this reason, most unions, includingthe AFL, excluded women.

In 1903 two woman labor organizers, MaryKenney O’Sullivan and Leonora O’Reilly, decided toestablish a separate union for women. With the help

of Jane Addams and Lillian Wald—the founders ofthe settlement house movement—they establishedthe Women’s Trade Union League (WTUL), the firstnational association dedicated to promotingwomen’s labor issues. The WTUL pushed for aneight-hour day, the creation of a minimum wage, anend to evening work for women, and the abolition ofchild labor. The WTUL also collected funds to sup-port women on strike.

Comparing How were female

industrial workers treated differently than male workers in the

late 1800s?

Reading Check

Reading Check



1. Define: deflation, trade union,industrial union, lockout, Marxism,arbitration, closed shop.

2. Identify: blacklist, Knights of Labor,injunction.

3. List the groups of workers representedby the Knights of Labor and theAmerican Federation of Labor.

Reviewing Themes

4. Individual Action What political contribution did Mary Harris “Mother”Jones make to American society?

Critical Thinking

5. Analyzing Why did early labor unionsfail?

6. Organizing Use a graphic organizersimilar to the one below to list the fac-tors that led to an increase in unions inthe late 1800s.

Analyzing Visuals

7. Analyzing Photographs Examine thephotograph at the top of this page ofworkers in a watch factory. Most of thepeople in the picture are women. Whatdo you think the jobs were of the menin the photograph?

Factors Contributing

to Unionization

Detail Work These women worked in the National Elgin Watch

Company’s gilding room, where they gilded metal watches with thin layers

of gold. What do you notice about their working conditions?

History

8. Persuasive Writing Imagine that youare an American worker living in one ofthe nation’s large cities. Write a letter toa friend explaining why you support oroppose the work of labor unions.


unions, represented only 18 percent. As the 1900sbegan, the vast majority of workers remained unor-ganized, and unions were relatively weak.

Analyzing What AFL policies

contributed to its growth as a union?

Working WomenThroughout the 1800s, most wage-earning work-

ers in the United States were men. After the CivilWar, the number of women wage earners began toincrease. By 1900 women made up more than 18 per-cent of the labor force.

The type of jobs women did outside the home inthe late 1800s and early 1900s reflected society’s ideasabout what constituted “women’s work.” Roughlyone-third of women worked as domestic servants.Another third worked as teachers, nurses, salesclerks, and secretaries. The remaining third wereindustrial workers, but they were employed in lightindustrial jobs that people believed appropriate totheir gender. Many worked in the garment industryand food processing plants.

Regardless of their employment, women werepaid less than men even when they performed thesame jobs. It was assumed that a woman had a manhelping to support her, either her father or her hus-band, and that a man needed higher wages to sup-port a family. For this reason, most unions, includingthe AFL, excluded women.

In 1903 two woman labor organizers, MaryKenney O’Sullivan and Leonora O’Reilly, decided toestablish a separate union for women. With the help

of Jane Addams and Lillian Wald—the founders ofthe settlement house movement—they establishedthe Women’s Trade Union League (WTUL), the firstnational association dedicated to promotingwomen’s labor issues. The WTUL pushed for aneight-hour day, the creation of a minimum wage, anend to evening work for women, and the abolition ofchild labor. The WTUL also collected funds to sup-port women on strike.

Comparing How were female

industrial workers treated differently than male workers in the

late 1800s?

Reading Check

Reading Check



1. Define: deflation, trade union,industrial union, lockout, Marxism,arbitration, closed shop.

2. Identify: blacklist, Knights of Labor,injunction.

3. List the groups of workers representedby the Knights of Labor and theAmerican Federation of Labor.

Reviewing Themes

4. Individual Action What political contribution did Mary Harris “Mother”Jones make to American society?

Critical Thinking

5. Analyzing Why did early labor unionsfail?

6. Organizing Use a graphic organizersimilar to the one below to list the fac-tors that led to an increase in unions inthe late 1800s.

Analyzing Visuals

7. Analyzing Photographs Examine thephotograph at the top of this page ofworkers in a watch factory. Most of thepeople in the picture are women. Whatdo you think the jobs were of the menin the photograph?

Factors Contributing

to Unionization

Detail Work These women worked in the National Elgin Watch

Company’s gilding room, where they gilded metal watches with thin layers

of gold. What do you notice about their working conditions?

History

8. Persuasive Writing Imagine that youare an American worker living in one ofthe nation’s large cities. Write a letter toa friend explaining why you support oroppose the work of labor unions.

Reviewing Key Facts

23. Identify: Morrill Tariff, Andrew Carnegie.

24. The United States had an advantage in industrializing due to

its resources and large workforce. What resources did the

nation have? Why was its workforce large?

25. How did inventions contribute to economic growth in the

United States in the late 1800s?

26. How did the federal government encourage railroad compa-

nies to construct railroads?

27. What new methods of selling products were developed in the

late 1800s?

28. Why did workers try to organize labor unions in the United

States in the late 1800s?

29. What were the two basic types of workers in American indus-

try at this time?

Critical Thinking

30. Analyzing Themes: Individual Action List the names and

actions of five people who contributed to American eco-

nomic growth in the late 1800s.

31. Organizing Use a graphic organizer similar to the one

below to list the factors that led to making the United States

an industrial nation.

32. Interpreting Primary Sources Americans like Ida Tarbell

criticized large corporations such as the Standard Oil

Company. In the following excerpt from History of the

Standard Oil Company, she warns of the results of

Rockefeller’s business practices on the nation’s morality.

Read the excerpt and answer the questions that follow:

“Very often people who admit the facts, who are will-

ing to see that Mr. Rockefeller has employed force and

fraud to secure his ends, justify him by declaring, ‘It’s

business.’ That is, ‘It’s business’ has come to be a legiti-

mate excuse for hard dealing, sly tricks, special privileges.

It is a common enough thing to hear men arguing that

the ordinary laws of morality do not apply in business.

1. gross national product

2. laissez-faire

3. entrepreneur

4. time zone

5. land grant

6. corporation

7. economies of scale

8. fixed costs

9. operating costs

10. pool

11. vertical integration

12. horizontal integration

13. monopoly

14. trust

15. holding company

16. deflation

17. trade union

18. industrial union

19. lockout

20. Marxism

21. arbitration

22. closed shop

Reviewing Key TermsOn a sheet of paper, use each of these terms in a sentence.

Factors Leading

to Industrialization

Abundant natural resources

Cheap immigrant labor force

High tariffs that reduced foreign goods

National communication and transportation networks

Little or no government intervention

Development of pools, trusts, holding companies, and monopolies

Small businesses could not compete with economies–of–scale of large businesses

Practices of some big businesses sometimes limited competition

•

•

•

•

•

•

Rural migration and immigration created large, concentrated workforce

In large–scale industries, low wages, long hours, and dangerous working conditions were common

First large unions formed but had little bargaining power against large companies

•

•

•

•

Factors Behind Industrialization

Changing Workplace

Growth of Business

•

As for the ethical side, there is no cure but in an

increasing scorn of unfair play. . . . When the business-

man who fights to secure special privileges, to crowd his

competitor off the track by other than fair competitive

methods, receives the same summary disdainful

ostracism by his fellows that the doctor or lawyer who is

‘unprofessional,’ the athlete who abuses the rules,

receives, we shall have gone a long way toward making

commerce a fit pursuit for our young men.”—quoted in Readings in American History

a. According to Tarbell, what practices had Rockefeller

used to establish the Standard Oil Company?

b. In what way did Tarbell believe the attitudes of the

American people contributed to Rockefeller’s business

practices?

33. Analyzing Analyze the impact of technological innovations

and industrialization on the American labor movement.

Practicing Skills

34. Making Inferences Reread the passage titled “Working in

the United States” from Section 4, page 454. Then answer

the following questions.

a. What facts are stated about working conditions in the

United States during this time period?

b. Based on your answer to the previous question, what can

you infer about the attitude of employers toward their

workers during this time?

Writing Activity

35. Portfolio Writing: Persuasive Writing Think of a product

that you think is essential to life today. Write an advertise-

ment for this product that would persuade people to

purchase it.

Chapter Activity

36. American History Primary Source Document Library

CD-ROM Read “Driving the Golden Spike” by Alexander

Toponce, under Reshaping the Nation. For further back-

ground, reread your textbook’s coverage of the same subject

on page 443. Then prepare a presentation for your class-

mates. In it, describe what Toponce had to say about the

workers during the celebration and what Grenville Dodge

had to say about their experience during the project. What

attitudes do you think each man had toward the workers?

Economics and History

37. The graph above shows steel production from 1865 to 1900.

Study the graph and answer the questions below.

a. Interpreting Graphs Between what years did steel

production have the greatest increase?

b. Making Inferences How did increased steel production

contribute to American industrialism?

Steel Production, 1865–1900

Source: Historical Statistics of the United States: Colonial Times to 1970.

Mill

ion

s o

f To

ns

1865 1870 1875 1880 1885 1890 1895 1900

1

2

3

4

5

6

7

8

9

10

11

12

Year

HISTORY

Self-Check QuizVisit the American Vision Web site at tav.glencoe.com

and click on Self-Check Quizzes—Chapter 14 to

assess your knowledge of chapter content.

StandardizedTest Practice

Directions: Choose the best answer to the

following question.

Labor unions were formed for all of these reasons except:

F To improve workers’ wages

G To protect factory owners from being sued

H To make factories safer

J To prevent children from working long hours

Test-Taking Tip: If a question uses the word except, you

need to look for the answer that does not fit. Remember

that unions were formed to try to help workers. Which

answer is least likely to help workers?



Chapter 14: Industrialization, 1865-1901 · 2018-08-06 · CHAPTER 14 Industrialization 439 1877...

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